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| From pyramid to diamond |
- Data on the growth of the middle class. The income class distribution in Brazil used to look like a pyramid, now it is diamond-shaped. The Brazilian middle class now represents 53% of the population or roughly 101 million consumers. The wealthier A and B classes represent 22% and the "poor" are now 25% of the country's population.
- Air travel versus Bus travel. Brazilians used to travel by bus, because it was cheap and convenient. But with the growth of the middle class and the arrival of low cost airlines like Azul and Gol, Brazilians now prefer to take a plane for interstate travel. In a country of continental dimensions, this means increased productivity, but also a huge burden on the infrastructure. The Porto Alegre airport, for example, has seen a 90% increase in traffic from 2005 to 2010.
- Taxes. Brazilian authorities announced that tax revenues for 2011 were 19.7% above the same period in 2010, and that the February numbers were the highest ever for that month. This is the result of the increased economic activity in the country, although critics complain that tax revenue is growing faster than the economy, which grew 7.5% last year.
A relevant factor for the localization community is the fact that according to an English Proficiency Index study by EF highlighted by the Lioness blog "Latin America has the lowest level of English proficiency of any region. Only Mexico and Argentina score above low proficiency."
So if you want to sell in Latin America, start localizing now!
“This is the result of the increased economic activity in the country, although critics complain that tax revenue is growing faster than the economy, which grew 7.5% last year.”
ReplyDeleteNot sure why the critics would complain about this. With the demographic shifts you are talking about and any sort of reasonable tax structure, this is exactly what you would expect to see happen. If people are moving into the middle class and it is a driver of growth, you are seeing people who weren't previously paying taxes at all now paying taxes because they can afford it now. That shift into the system will have a disproportionate impact compared to any marginal changes for those already in the system.
So the critics really have nothing to complain about at all. Those number look very healthy and are a positive sign about the Brazilian economy.
R- have you seen this article about 500Startups Geeks on a Plane in LATAM right now?
ReplyDeletehttp://www.fastcompany.com/1750884/brazilian-startup-scene-fired-up-in-sao-paolo
Perhaps, like most of us in a foreign country, he was incapable of placing people, selecting a frame for their picture, as he would at home; therefore all Americans had to be judged in a pretty equal light, and on this basis his companions appeared to be tolerable examples of local color and national character.
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