) arranged in the same
pattern as the night sky over Brazil; the globe has a white
equatorial band with the motto ORDEM E PROGRESSO (Order and Progress)

Brazil Economy

Economy - overview: Possessing large and well-developed
agricultural, mining, manufacturing, and service sectors, Brazil's
economy outweighs that of all other South American countries and is
expanding its presence in world markets. In the late eighties and
early nineties, high inflation hindered economic activity and
investment. "The Real Plan", instituted in the spring of 1994,
sought to break inflationary expectations by pegging the real to the
US dollar. Inflation was brought down to single digit annual
figures, but not fast enough to avoid substantial real exchange rate
appreciation during the transition phase of the "Real Plan". This
appreciation meant that Brazilian goods were now more expensive
relative to goods from other countries, which contributed to large
current account deficits. However, no shortage of foreign currency
ensued because of the financial community's renewed interest in
Brazilian markets as inflation rates stabilized and the debt crisis
of the eighties faded from memory. The maintenance of large current
account deficits via capital account surpluses became problematic as
investors became more risk averse to emerging market exposure as a
consequence of the Asian financial crisis in 1997 and the Russian
bond default in August 1998. After crafting a fiscal adjustment
program and pledging progress on structural reform, Brazil received
a $41.5 billion IMF-led international support program in November
1998. In January 1999, the Brazilian Central Bank announced that the
real would no longer be pegged to the US dollar. This devaluation
helped moderate the downturn in economic growth in 1999 that
investors had expressed concerns about over the summer of 1998.
Brazil's debt to GDP ratio for 1999 beat the IMF target and helped
reassure investors that Brazil will maintain tight fiscal and
monetary policy even with a floating currency. The economy continued
to recover in 2000, with inflation remaining in the single digits
and expected growth for 2001 of 4.5%. Foreign direct investment set
a record of more than $30 billion in 2000.

GDP: purchasing power parity - $1.13 trillion (2000 est.)

GDP - real growth rate: 4.2% (2000 est.)

GDP - per capita: purchasing power parity - $6,500 (2000 est.)

GDP - composition by sector: agr