Brazil

This report summarizes the study conducted by a group of students at Columbia University under the aegis of Dr. Ibrahim Odeh in the course “International Construction Management” during Fall Semester of 2021. The students focused on market analysis of Brazil as a nation with respect to the construction industry and how it is affected by various political, social , cultural ,economic factors and most significantly force majeures such as the global pandemic Covid-19. The focus has been to determine the impediments that have hindered the growth of the industry and the possible solutions to overcome those. Various quantitative indicators like GDP, Per Capita Income, Popular, etc were studied, along with qualitative indicators such as corruption, safety and happiness index. The study culminates with recommendations and key takeaways to improve the state of industry. These are not exhaustive but capture the essence of changes that need to be made for a better future of the nation and industry as a whole.

Key Observations

Brazil is a developing nation that is striving towards advancement. The construction sector’s contribution to the nation’s GDP has been decreasing in recent years, however, the Brazilian government has recently allocated 1.4 trillion USD of funding towards improving the infrastructure within the country, and in turn the construction industry is poised to grow. Transportation infrastructure is severely sub-par, with only 15% of roads in the entire country being paved. The energy sector is advancing rapidly, with intense focus on providing renewable energy sources. The construction industry in Brazil has been plagued by frivolous government spending and rampant corruption. Recently, there have been serious scandals within the construction industry, some even involving the President’s Office. Even with its setbacks, Brazil is still the fourth largest country in the world considering foreign direct investment. It possesses a young population which has the ability to take the nation forward and make a dent in the world’s economy

Takeaways and Recommendations

1. The business environment should be more receptive for the global companies to participate in bidding for the projects. With their vast experience, technology and culture, not only the corruption in the industry would be controlled but also the credibility of the project and government would be enhanced. Bringing in global companies can curb corruption and bring new technology into the country that will push it towards advancement.

2. The dire need of meeting the country’s skilled force can be solved by training the personnel at educational and vocational level. The retention rates of employees in the firms can be significantly improved if companies invest in healthcare policies as well as increase the standard of safety norms at the workplace.

3. Though Anti-Corruption laws already exist in the country, the way to mitigate it is through more transparent systems i.e all the tendering and bidding processes of projects should be done through E-Tendering modes and physical modes should be minimized.

In the above figure, we see that that the construction share in the GDP of Brazil dropped significantly after the Car Wash Up Operation in 2014 and steeply dropped after the onset of Pandemic covid-19. But again, we see that it is revamping and is still not insignificant.