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It was just a matter of time until Brazil could officially overtake Britain and become the sixth largest economy in the world. This is the result of a process of steady growth that has characterised Brazil's economy in the last twenty years or so, a growth that has not been affected by the economic crisis that has hit the established western economies since 2008. Last year Brazil's economy registered a 2.7% improvement, far from the 0.8% in the UK, and it is sure that, if the current trend continues to follow the same pattern in the next few years, Brazil will be able to overtake big economies including the likes of France and Germany. The current unfavourable situation seems not to have affected Brazil and its economy as badly as most of the western world, even though 2011 registered the first real slow down, as last quarter saw the economy grow only by 0.3% from the previous quarter. Even though in many countries, due to current unfavourable conditions, a 0.3% grow would be considered a pretty good result, that is not the case in Brazil, as growth was 5% in 2010 and an astonishing 34% the year before. Under president Lula, loved and respected by his countrymen, Brazil has also managed for the first time in its history to reach a level of welfare never seen before, with the middle class outnumbering the lower class for the first time, an achievement for which president Lula will not be easily forgotten. In fact, Brazil’s Gini coefficient, which measures income inequality, hit a record low of 0.53 points last year, a great result if compared to the 0.61 recorded in 1990. With its economy now worth $2.5 trillion, Brazil is enjoying a great moment in its history, mainly due to high oil and food prices (Brazil is one of the main exporters of soya and oil) as well as domestic inflation which has caused the Brazilian Real to reach an exchange rate of £0.35. Labelled as an emerging economy like Russia, India and China (BRIC), it seems like this tag is no longer as appropriate and realistic: after a series of years of steady growth, Brazil's economy appears more consolidated than ever, and yet very dynamic thanks to the size of the country, the natural resources available as well as the human resources, ideal elements that make Brazil a great place to invest.
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