BY GEORGE LEHNER
Brazil showed a significant decline in the 2017 FSI, becoming the fourth most worsened country since 2016, largely as a result of a devastating recession, continued fallout from widespread political corruption probes, and the impeachment of its President. Overall, Brazil worsened by 2.9 points on its total score compared to the prior year.
In nine of the twelve measures of fragility, Brazil’s performance worsened markedly, dropping most notably in the areas of Group Grievance, Demographic Pressures, and Public Services. The three-year trend line demonstrates similar levels of declines across eight of the twelve indicators, with notable changes in the Security Apparatus, the Economy, and Public Service indicators.
While Brazil received considerable international attention in 2016 as a result of hosting the Summer Olympics, the Games were often overshadowed by the deepening political crisis that saw President Rousseff impeached in August 2016. Indeed, the governor of the state of Rio de Janeiro declared a state of financial emergency only weeks before the Games. Moreover, it was impossible to ignore the rising unemployment rate as it spiked over the course of the year, and the fall of GDP as it tumbled by 7%.
Equally apparent to Brazil’s citizens was the sharp decline in public services, particularly in the education and health sectors, a fact underlined by the failure of the state of Rio de Janeiro to pay its public sector workers for a significant period of time due to the lack of government funds. As a result — and predictably — Group Grievance has continued to rise as almost all levels of society have felt the impact of both a more fragile political climate and significant economic decline.
Brazil’s increasing measure of fragility, first evident in 2014, began after a five year period where it was viewed, along with Russia, India, China, and South Africa, as one of the new and emerging engines of growth and prosperity for the 21st century. As a review of the FSI’s ten-year trend numbers demonstrates, starting in 2009, Brazil began to show steady and significant year-to-year improvement as measured by the FSI indicators. Those trends were particularly marked in the areas of Group Grievance, Human Flight & Brain Drain, External Intervention, and the Economy.
However, that trend not only has slowed down but quickly reversed course. Falling oil prices and overall global economic slowdown took hold in 2014/2015, hitting Brazil particularly hard. These events were exacerbated by the political instability that erupted after President Rousseff’s election to a second term in October 2014. Their collective impact shook Brazil and the country began to feel the kind of pressures that challenge a state’s ability to respond to social and economic needs of a rapidly growing population. The FSI data strongly suggest that the rapid economic growth that characterized Brazil in in the 2009-2014 period was not accompanied by similar strengthening of state and civil institutions. Lack of transparency, increased corruption at the highest levels, a rapid expansion of an over-burdened, under funded public service sector, and a failure to address growing wealth disparity, all combined to undermine state legitimacy just as the economic slow down took shape. As various sectors of Brazilian society push for an increased share of a shirking economic pie, regional tensions have risen as well, as reflected, in part, by a 5% rise, in the last year, of the Group Grievance indicator.
Despite the economic and political setbacks of the last several years, Brazil has Latin America’s largest economy at $1.35 trillion. It possesses significant and untapped natural resources, and its fundamental government institutions have withstood significant challenges. Continuing to build confidence in the government’s ability (at the federal and state) level to deliver basic public services, even as the economy begins a slow recovery, will be crucial to Brazil’s ability to build the kind of state resilience necessary for the Brazil’s long-term success.