Shannon K. O'Neil

Latin America's Moment

O'Neil analyzes developments in Latin America and U.S. relations in the region.

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Showing posts for "Brazil"

Lights Out: Brazil’s Power Problem

by Shannon K. O'Neil
A view of the Itaipu Hydroelectric dam, the world's largest operational electricity generator, on the Brazilian side of the border with Paraguay, in Foz do Iguacu in this 2005 file photo. A major electricity outage at the dam left tens of millions of people in Brazil's two largest cities of Sao Paulo and Rio De Janeiro without power on November 10, 2009, according to the Brazilian director of the Itaipu dam (Rickey Rogers/Courtesy Reuters). A view of the Itaipu Hydroelectric dam, the world's largest operational electricity generator, on the Brazilian side of the border with Paraguay, in Foz do Iguacu in this 2005 file photo. A major electricity outage at the dam left tens of millions of people in Brazil's two largest cities of Sao Paulo and Rio De Janeiro without power on November 10, 2009, according to the Brazilian director of the Itaipu dam (Rickey Rogers/Courtesy Reuters).

With the World Cup over, Brazilians are turning to their next big event—October’s presidential elections. While President Dilma Rousseff still leads in the polls, her margins continue to shrink. A recent Datafolha poll puts Rousseff and Aecio Neves—her leading challenger—as statistically tied in a hypothetical second round. Read more »

Foreign Direct Investment in Latin America Holds Steady in 2013

by Shannon K. O'Neil
Robots weld cars at the Ford Motor Company's Sao Bernardo do Campo facility in Sao Bernardo do Campo, June 14, 2012 (Paulo Whitaker/Courtesy Reuters). Robots weld cars at the Ford Motor Company's Sao Bernardo do Campo facility in Sao Bernardo do Campo, June 14, 2012 (Paulo Whitaker/Courtesy Reuters).

In 2013, foreign direct investment (FDI) in Latin America reached $185 billion according to the latest ECLAC report, continuing the slight upward trend of the last three years. Brazil maintained its number one position as the largest FDI destination, raking in $64 billion (over one third of all regional FDI). Mexico came in second, with some $38 billion (boosted by the $13 billion purchase of the rest of Modelo by Belgian based Anheuser-Busch InBev, a company run by Brazilians). Mexico’s Pacific Alliance partners—Chile, Colombia, Peru—also had a fruitful year, with a combined $47 billion in investment. And despite its economic woes, Argentina garnered $9 billion. Read more »

Will the World Cup Actually Help Brazil to Solve Its Problems?

by Shannon K. O'Neil
Residents run to celebrate after decorating a street in the colours of Brazil’s national flag, ahead of the 2014 World Cup, in the Taguatinga neighbourhood of Brasilia, June 8, 2014 (Ueslei Marcelino/Courtesy Reuters). Residents run to celebrate after decorating a street in the colours of Brazil’s national flag, ahead of the 2014 World Cup, in the Taguatinga neighbourhood of Brasilia, June 8, 2014 (Ueslei Marcelino/Courtesy Reuters).

In the lead-up to the World Cup and through the first games, Brazilians have taken to the streets in protest. In this post for Daniel Altman on ForeignPolicy.com, I look at why these demands for change could help Brazil overcome its many domestic problems. The post begins: Read more »

S&P’s Brazil Downgrade: Why it Matters

by Shannon K. O'Neil
Brazil's President Dilma Rousseff reacts during the signing ceremony of the Rio de Janeiro's international airport concession in Rio de Janeiro, April 2, 2014 (Ricardo Moraes/Courtesy Reuters). Brazil's President Dilma Rousseff reacts during the signing ceremony of the Rio de Janeiro's international airport concession in Rio de Janeiro, April 2, 2014 (Ricardo Moraes/Courtesy Reuters).

In a widely expected move, the ratings agency Standard and Poor’s (S&P) downgraded Brazil’s long term debt from a credit ranking of BBB to BBB- on March 24, bringing the country’s sovereign bonds a step closer to losing their “investment grade status” (defined as BBB- or above) and becoming “speculative” or “junk bonds.” The rating stems from a combination of indicators—including GDP growth, inflation, and external debt—that S&P uses to measure a country’s creditworthiness and its fiscal, regulatory, and political risks. Read more »

This Year’s Presidential Elections in Latin America

by Shannon K. O'Neil
Voters wait in line to cast their vote in a presidential election runoff at a polling station outside in San Salvador March 9, 2014 (Henry Romero/Courtesy Reuters). Voters wait in line to cast their vote in a presidential election runoff at a polling station outside in San Salvador March 9, 2014 (Henry Romero/Courtesy Reuters).

Earlier this week, Salvadorans headed to the polls to cast their ballots in a presidential runoff election, since on February 2 the candidates failed to reach the 50 percent threshold to avoid a second round. In the runoff’s lead up, Salvador Sánchez Cerén, a former guerrilla commander and the current vice president from the ruling party, looked poised for an easy win over his closest opponent Norman Quijano from the conservative Nationalist Republican Alliance (ARENA). But with the final ballot count separating the candidates by some 0.2 percent of the votes and with allegations of fraud, it seems that the protests and debates surrounding this election are far from over. Read more »

Public Education in Brazil

by Shannon K. O'Neil
A Brazilian citizen, living in Mexico, holds a poster during a demonstration in Mexico City June 18, 2013, in solidarity with a protest movement against poor public services, police violence and government corruption in Brazil (Edgard Garrido/Courtesy Reuters). A Brazilian citizen, living in Mexico, holds a poster during a demonstration in Mexico City June 18, 2013, in solidarity with a protest movement against poor public services, police violence and government corruption in Brazil (Edgard Garrido/Courtesy Reuters).

When people talk about what holds Brazil back, education tops the list (along with infrastructure). The poor quality of Brazil’s public education system limits students’ capabilities and adaptability, creates mismatches between workers’ skills and companies’ needs, and stifles productivity and entrepreneurship. These limits affect the entire economy—hampering economic growth, competitiveness, research & development, and even oil production (as Petrobras has struggled to find skilled workers for its pre-salt finds). Read more »

Brazil’s Pre-Salt Oil Six Years Later

by Shannon K. O'Neil
An aerial view of the final stage of the construction of new P-56 semi-submersible production platform for the oil company Petrobas at the Brasfels shipyard in Angra dos Reis, about 115 miles (185 km) west of Rio de Janeiro February 24, 2011 (Sergio Moraes/Courtesy Reuters). An aerial view of the final stage of the construction of new P-56 semi-submersible production platform for the oil company Petrobas at the Brasfels shipyard in Angra dos Reis, about 115 miles (185 km) west of Rio de Janeiro February 24, 2011 (Sergio Moraes/Courtesy Reuters).

In 2007, Petrobras engineers struck black gold, discovering vast oil reserves in the deep-water off the Brazilian coast and permanently altering not only Brazil’s energy landscape but the country’s economic and political fortunes. Immediate surveys predicted that some 80 billion barrels were trapped in these pre-salt reserves (named after the rock layer they are located in), a number so high that then-President Lula declared the find as proof that “God is Brazilian.” Read more »

Dilma Rousseff’s Tenure Three Years On

by Shannon K. O'Neil
Brazil's President Dilma Rousseff reacts during a press statement after a meeting at the 6th European Union (EU)-Brazil summit at the Planalto Palace in Brasilia January 24, 2013 (Ueslei Marcelino/Courtesy Reuters). Brazil's President Dilma Rousseff reacts during a press statement after a meeting at the 6th European Union (EU)-Brazil summit at the Planalto Palace in Brasilia January 24, 2013 (Ueslei Marcelino/Courtesy Reuters).

Brazil’s President Dilma Rousseff is gearing up for her reelection bid this week, attending political rallies and drumming up support by appearing with former President Lula. As she hits the campaign trail, over the next year she will be campaigning on—or alternatively explaining—her last three years in office. So what has Rousseff accomplished during her time at Brazil’s helm? The results are, in my view, mixed. Read more »

Foreign Direct Investment and Jobs in Latin America

by Shannon K. O'Neil
Employees work at an assembly line at a Ford manufacturing plant in Sao Bernardo do Campo June 14, 2012 (Paulo Whitaker/Courtesy Reuters). Employees work at an assembly line at a Ford manufacturing plant in Sao Bernardo do Campo June 14, 2012 (Paulo Whitaker/Courtesy Reuters).

In 2012 Latin America received its largest amount of foreign direct investment (FDI) to date: $170 billion or 12 percent of global flows. These flows went into a range of sectors from mining and petroleum production to high skilled and low skilled manufacturing to telecommunications and electricity. Read more »

Transforming Brazil’s Favelas

by Shannon K. O'Neil
Children play in front of the field at Cidade de Deus (City of God) slum in Rio de Janeiro March 15, 2011, where U.S. President Barrack Obama will visit on Sunday, according to the local press (Ricardo Moraes/Courtesy Reuters). Children play in front of the field at Cidade de Deus (City of God) slum in Rio de Janeiro March 15, 2011, where U.S. President Barrack Obama will visit on Sunday, according to the local press (Ricardo Moraes/Courtesy Reuters).

I got the chance last week to visit the Centro Comunitário Lídia dos Santos (or CEACA), an NGO based in the Rio de Janeiro favela of Morro dos Macacos—once the grounds of a zoo, and now home to some 25,000 cariocas (Rio’s residents). Headed by Dona Anna Marcondes Faria, it is the culmination of nearly fifty years of her work to make the community safer. From initial efforts to bring running water and kindergarten classes to the neighborhood, the two story building now offers a host of after school programs, art classes, professional training sessions, and environmental awareness projects. The goal is not just to teach skills but also confidence. CEACA, along with NGOs in some 450 other communities, have gained the attention and support of Coca-Cola, McDonalds, Walmart, and dozens of other corporations. Read more »