Brazil cost (Portuguese: Custo Brasil [ˈkustu bɾaˈziw]) refers to the increased operational costs associated with doing business in Brazil,[1] making Brazilian goods and services more expensive compared to other countries.[2] There are several factors that contribute to the extra cost, including:
- High levels of public deficits;[3]
- The economy divided into cartels;[4]
- Inefficiency of public services;[5]
- Maintenance of high real interest rates;[6]
- Exaggerated net interest spread of financial institutions (among the highest in the world);[7]
- Excessive bureaucracy for importing and exporting, creating difficulties for foreign trade;[6]
- Low education levels and lack of qualified labour;[8]
- Excessive layers of bureaucracy (red tape), e.g., starting a company in Brazil takes at least 120 days;[9][10]
- High levels of corruption within the public sector;[9]
- High tax burden;[11]
- Expensive labour costs;[12]
- High social security costs;[13]
- Complex and inefficient fiscal legislation;[6]
- Economic instability;[9]
- High electricity cost;[14][6]
- Legal uncertainty;[15]
- High interest rates;[16][6]
- High crime rate, which adds extra security costs;[2]
- Underdeveloped infrastructure, including a deteriorated network for domestic shipping by rail, highway and coastal navigation*.[1][6]
In 2007 transport costs consumed 13% of GDP, 5% more than in the United States.[17] The high transport costs are exacerbated by the scattering of industry over Brazil's vast territory.[18]
See also
References
