The Brazilian economy passed through a period of relatively higher economic growth from 2004 to 2008, generating positive expectations for future economic growth. However, the favourable world scenario changed after the world crises that started in 2008. Despite the quick recovery, Brazil has presented difficulties to recover the economic growth rates verified between 2004 and 2008 and the expectations are not better for the near future. The aim of this research is to provide an explanation for the difficulties Brazil has faced to boost and maintain its GDP growth in the recent period at similar rates compared to the 2004-2008 period. The hypothesis is that these difficulties are related to the lower growth rate of manufacturing production, considering that the relationship between GDP and manufacturing growth rates has changed since trade and financial liberalisation were implemented. The better economic performance in the 2004-2008 period was achieved with the manufacturing production growth being lower than the GDP growth, a different outcome compared to the period of industrialization (from 1930 to 1980). Lower manufacturing growth rates compared to the GDP growth rates were also verified in the period after the 2008 crisis. In this sense, higher economic growth in the recent period will probably require changes in the composition of its growth rate, i.e. changes in the sources of its growth dynamism. Moreover, the lower economic activity in countries affected by the crisis was followed by a deeper competition between world producers for the demand for the less affected countries' markets, with repercussion on the international trade. So, to understand the difficulties to boost the Brazilian GDP growth, this research proposes analysing the changes that took place in the Brazilian external trade and manufacturing production since 1999The study of these difficulties is divided in three parts. The first one studies the changes in the Brazilian external trade, identifying the sectors responsible for the trade improvement after 2003 and what occurred with them after the crisis. The second one evaluates the changes in the manufacturing production in Brazil and the role of imports in each sector, identifying the costs related to imports and the role of the nominal exchange rate. And finally, the third one analyses, with the use of an economic model, the behaviour of investments and its main determinants in the period 1999-2011.
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