Brazil embraces immigration reform

Brazil embraces immigration reform

Brazil has announced plans for a streamlined work visa application for skilled foreign workers, which should help fill its current skilled labor shortage.

2013 brought plenty of difficulties for Brazil. Mass protests over the summer, spurred by increases in public transportation fares, resulted in many questioning the viability and endurance of the Brazilian economy and long-term growth. Encouraged by poor infrastructure spending, corruption, high interest rates and a frustrated and growing middle class, the protests seemed to symbolize the stagnating growth after the end of the commodities boom.

While President Dilma Rousseff’s government has promised reforms and taken some encouraging steps, many have remained concerned. Indeed, the third fiscal quarter showed a surprisingly disappointing GDP drop following a very positive second quarter.

While this may signal a necessary level of caution for many investors in a presidential election year rife with political strife and base appeals, 2014 is opening with some distinctly positive news. Recent changes to Brazilian immigration policies may signal that Brazil seeks to address some of the issues which have plagued the country and worried investors.

The commodities boom and Brazil’s correlating growth have served to highlight problems with Brazil’s immigration policies. The growth encouraged many low skilled workers, from countries such as Haiti, to immigrate to Brazil illegally and work.

The slowed growth has worked to highlight stresses in certain sectors, including manufacturing, in which some of these workers often find employment. More importantly, Brazil has long suffered from a ‘brain drain’ as many of its most educated and highly trained specialists seek work elsewhere. While the growth of much of the last decade has resulted in quite a few native Brazilians returning home, the country is still in desperate need of workers to fill engineering, research, healthcare and other specializations.

On January 16, 2014 Brazil’s Strategic Affairs Minister Marcelo Neri announced the country would be making important changes to its immigration policies. These involve reducing Brazil’s considerable bureaucracy and the impediments that it imposes on the immigration process. The changes would enable workers already in the country to switch jobs without applying for another visa. Additionally, the changes aim to reduce the amount of paperwork involved in applying for a visa.

Particular attention will be paid to applicants from countries with ‘linguistic affinities’ to Brazil, such as Italy, Portugal, Spain, and other Latin American countries. Interestingly, in announcing the proposed changes, Neri mentioned that more specialized foreign workers are needed, as the current rate of ‘near full employment’ could potentially jeopardize economic growth. Indeed, the unemployment rate in November of last year was only 4.6 percent, a record low unmatched since 2002.

Neri’s comments illustrate not only an interesting lack of faith in the ‘full employment’ strategy, but also concern that without workers in key specialized sectors, Brazilian growth may languish.

Brazil’s poor infrastructure has not only been a spark for many of the protests, but highly publicized collapses of high profile structures such as World Cup stadiums have significantly hurt Brazil’s brand and image as a rising power. Moreover, poor infrastructure creates added costs and risks for businesses seeking to invest and do business in Brazil. While Brazil only spends 1.5 to 2 percent of its GDP on infrastructure, it is also in many cases getting a poor return on the little it does spend. With recent promises by President Dilma Rousseff to address infrastructure inadequacies and spending, creating greater ease of immigration for foreign engineers to work in Brazil would significantly help to solve these problems.

Like many countries in Latin America, Brazil suffers from a lack of doctors. Among other strategies, Rousseff has instituted the Mais Medicos program which imports over 11,000 Cuban doctors to work in poor and rural areas. Yet, despite this program, Brazil still has a shortage of at least 160,000 doctors. A growing middle class with greater expectations for public services means that addressing Brazil’s doctor shortage is crucial.

Brazil seeks to open the continent’s first biotech facility in 2017. Yet, the aim to develop technology and R&D sectors has highlighted the shortage of many skilled tech workers. Making it easier for foreign workers to fill these jobs is important for continued growth in the country and for providing solutions for its public aims.

Plans to change Brazil’s immigration law is an encouraging sign for investors. Brazil has historically thrived from diversity and immigration. Moreover, with Brazilian growth having outpaced the ability of the country to create and train key segments of the workforce, foreign workers can provide a quick fix as Brazil seeks to address shortages domestically via training and education.

Yet, with growth in Brazil having slowed considerably and protests in the streets gaining publicity, questions remain as to whether Brazil’s model and present branding will be enough to attract the amount of foreign workers the country currently needs. The proposed changes lack specifics and reducing bureaucratic hurdles alone is unlikely to be enough to attract skilled professionals. However, for those looking for encouraging signs as 2014 begins, Brazil is not only willing to acknowledge problem areas, but maybe even to admit that its current conceptions of full employment economics and bloated, and often inept bureaucracy are part of the problem as well.

Categories: Latin America, Politics

About Author

Sean Durns

Sean Durns worked as a research assistant to a former high ranking Pentagon official and the Director of National Security Strategies at a DC based think tank. His analysis has been referenced by a variety of media outlets including The Wall Street Journal, Roubini's EconoMonitor, OilPrice, and many more. He holds a M.Sc. in History of International Relations from the London School of Economics where he focused on US foreign policy, security studies, and energy security.