Brazil needs to be more innovative: The excellent Schumpeter column drives home the point that not all BRICs are equal.
“Can their country become an innovator in its own right, or is its recent growth little more than a by-product of China’s appetite for commodities?” “Yet Brazil suffers from two huge blocks to growth: red tape and gaping inequality. For all its recent commitment to liberalisation the Brazilian government is still a rule-spewing, incumbent-protecting monster.” “Brazilian companies are also doing far less than their rivals in India and China to master the art of producing frugal goods for the masses.”
My correspondents in Brazil from the Harvard Career Network tend to be among the top few percent that are benefitting hugely from the recent boom, but such a filtered source of information via SKYPE and email can produce a skewed view: not all Brazilians are participating in the boom. Many of India’s strengths (frugal innovation, a culture which produced half of Silicon Valley’s start ups) may be Brazil’s weaknesses. Another scenario which could cause a BRIC-wide pullback in the Emerging Markets Index would be an economic bust in China, which in turn affected Brazil — two of the four BRIC nations. In its Cover Leader on Brazil a year ago, The Economist warned that the biggest risk for Brazil is hubris.