Brazil is Now World’s Fifth Largest Economy

Brazil became the fifth largest economy in the world at the end of 2010, and though it was predicted to achieve this the actual realization has come much sooner than expected, in fact it’s six years earlier than projections outlined by

President Lula in 2009. It’s partly due to the strength of the Real, the Brazilian currency, and partly due to the spectacular GDP growth. This means its economy is now slightly larger than Britain and France.

Last year’s GDP growth was 7.5%, and although it’s unlikely to be that strong this year analysts are still predicting it to the in the 4% to 5% range.

The country has benefited from low inflation which enabled it to shrug off the global crisis, but some analyst’s think that the currency is overvalued and that measures need to be taken to reduce government spending.

It seems as if Brazil is no longer just an emerging market but is fully established and that it offers excellent investment opportunities. The country was a founding member of Mercosul which is a Latin American trade agreement designed to facilitate world trade.

It is hosting the World Cup in 2014 and the Olympic Games in 2016 and the government is due to spend $32 billion on the infrastructure for these events while another $18 billion is being spent on a high-speed rail link between Rio and São Paulo.

The new airport is being built at the city of Sao Goncalo which is near to Natal, an area which is of increasing interest to international investors. It is one of the safest regions in Brazil and there are a number of new developments here which purport to offer investors high rental yields.

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