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Export/Import Research Paper

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Introduction

When taking Brazil into consideration, the first thing that comes to mind is the image of either the Christ-the-redeemer statute or Carnival. Such are symbols which depict the welcoming as well as hospitable, colorful and multicultural Brazilian history. Despite the fact that the primary language in Brazil is Portuguese, Its history is also inclusive of the indigenous African as well as Indian descendants. One interesting fact about Brazil is that it is the most extensive economy in Latin America. In fact, it is among the counties with the most reputable natural resources globally. Such may include; coffee, timber, sugars as well as soybean just to mention but a few. The US Department of Commerce records Brazil to be having about 3,290000 square miles, while at the same time also bordering ten other nations that have over 4650 miles of the costliness. Brazil is the largest nation in Latin America and it is the holds the fifth positions in the largest countries worldwide. The GDP of Brazil is US$2.3 trillion. In fact, Brazil is ranked as the seventh largest economy in the whole world.

Brazil Business Culture

The primary concepts of the business culture in Brazil are based on ensuring things are done through strong interpersonal relationships, informal networks as well as bending of the rules. In short, the Busines mantra of Brazil could be described to be Jeitinho (Becker, 2004). Jeitinho is a fast as well as efficient last minute approach to accomplish goals. The mantra operates by the breaking of the universalistic rule and hence utilizing informal as well as social and personal resource to get things done. Even though the culture of Brazil is less formal and also social, various economic indicators show some level of distinction.as such, their incomes have high and evident levels of inequality (Nicol, 2012). Brazil is also considered a context culture which impacts their business practices, such that it is governed by the personal understanding as well as respect versus their external rules as well as regulations. It could, in turn, lead to the contract bindings as per the interpretation. The various symbols of status which have power are quite significant when it comes to showing the social aspects as well as communication of what should be displayed. As such, in the business sector, they have only one boss, who is entirely responsible for everything.

Integrated business principles

The underlying Brazilian concepts constitute relationships, time as well as family. In fact, the family is considered to be the heart of the business social structure in the Brazil. Most of the businesses are owned and managed by the family, whereby, they have several family members working in the family organization (Branco & Williams, 2006). Moreover, there is always a close relationship between the boss and the family members who are working in the company. As such meetings always look like gatherings. The culture of the Brazilians is famous for their hospitable as well as affectionate nature. In fact, the interaction sin the workplace are inclusive of long handshakes as well as welcoming kisses between both genders. They place much emphasis on their appearance; in fact, the basic philosophy in the Brazilian business organization is that the commitment of an individual to their business is equivalent to the commitment they have to their appearance. Thus they say that if one commits much time to their appearance, then they will also do the same for the business. Due to such a high context, it is critical that an individual first establishes a personal relationship in order to communicate effectively (Today Translations, 2017). The personal relationships within the organization are critical for anyone intending to do business in Brazil. It is only through the personal relationships that people can hold comprehensive conversations and as such, strengthening trust in various business undertakings.

Also, Brazil runs at a slower pace as compared to other countries, more so in terms of the corporate sector. Such aspects of time for meetings as well as negotiation are quite relaxed and also flexible and they should be considered (WorldBusinessCulture.com, 2016). They also have lunch rituals, which must be respected by everyone, conducting business with the Brazilian organizations. The Brazilians rarely eat at an unrelaxed pace. In fact, they ensure that they enjoy several personal conversations during meals. Cording to their business culture, it is not permitted to discuss business over lunch is considered improper and in fact, they believe that it is not healthy as far as digestion is concerned. As such, it is advisable to always invest both times as well as money and also sustain relationships and also have frequent personal contact. In addition, small talk is also significant and should never be discarded during business negotiations. The Brazil believe in one saying that states, “For friends, everything; for strangers, nothing; and for enemies, the law”.

U.S vs. Brazil business culture

The greatest difference between the business culture of US and that of Brazil; is the emphasis on personal relationships. For instance, people are more like berries, and as such, they always replace appointment books. In that case, it is evident that personal relationships would also work best. The people of Brazil make bold distinctions between the outsiders and the insiders. In fact for those outsiders who do not have any personal relationships, their arrangement is considered secondary to the others. The US on the other hand never encourages personal relationships in matters concerning business.as such, in the US personal interaction is considered less favorable, and they focus more, on conserving the appointment schedules.in the US, no consideration is given to the insiders or outsiders, as it is the case in Brazil. At least, for both US and Brazil, communication, is considered an essential part of business transactions. However, in Brazil, they use, a unique, non-verbal communication mechanism, which id distinctively different from that if the US. As such, Brazilians emphasize on touch. In fact, they are famous for the gestures, as well as their unique expressiveness and handshakes, which differs from the US culture, where people only shake hands.

Brazilians are also more fashion-conscious since they relate how one dresses to the capability of the individual in doing business.in that case, their level of fashion consciousness is better than that of the US. The most significant area of dissimilarity between the business culture of US and Brazil relates to how the two countries perceive time. Brazil is a polychromic culture which often sets personal involvement above pre-planned schedules. The US, on the other hand, is a monochromic culture and hence they take schedules seriously and regard them higher that personal interactions.

Challenges for U.S to conduct business in Brazil

· ‘Custo Brasil’

The cost of conducting business in Brazil, also known as, ‘Custo Brasil’ constitutes consolidations of high rates of interest, insufficient and inappropriate infrastructure, and high rates of taxation as well as the distinction of the growing class. Because of the Custo Brasil, the Doing Business Report of the World Bank positioned Brazil at position 130.it thus explains why various consumer goods, as well as electronics, are much more expensive in Brazil, that most other parts of the world.

· Inadequate Infrastructure

Brazil has an infrastructure that has not been well maintained. For instance, they have several rundown ports as well as freeways. Moreover, Brazil also lacks the capacity since their businesses incur costs of about US$8.5billion every year. As per the Institute of ILOS, the goods take long before they can be shipped, and thus, the costs are often added to the prices of the goods. The other most significant problem in Brazil is their high energy costs (Vasconcellos, 2016). For instance, over 70% of the energy used in Brazil comes from hydroelectric power. In fact, studies show that the energy cost in Brazil is 50% above the average consumption in the whole world.

· Taxation Issues

Brazil has ranked among the lowest as far tax codes are concerned. In fact, it takes position 156 out of the overall 180. The rate of income tax in Brazil is 34%. Due to the poor taxation codes, at times business, incur more that 70% loss. All imports, as well as profit on items as well assets that are covered, are charged a CIDE rate of about 10% (Advogados, 2013). The financed businesses which also earn profits are rated between to 3 to 6.7%. On the CSLL, the rate is between 9 to 15% and it is charged or almost all legal entities in the Brazil, as well as those entities that are charged tax legislation. The duty charged on imports is based on the kind of goods. It charged on the importer.

The IOF, on the other hand, is charged on all the legal entities as well as private individuals. As such, it is charged at a fixed rate of 1.25%.the IPI is charged at a rate of between 0-300% and it charged on the owner of the industry as well as whoever is importing the goods. The PIS is charged at the rate of between 65 to 1.65% and it is charged on legal entities, inclusive of government organizations as well not-for-profit organizations. The IE, on the other hand, is charged at a rate of between 30 to 150 %and is charged on whoever is exporting the goods from the country (Brazil).the another one is the ICMS which is charged on private people as well as legal entities which commercialize the goods, the importers, as well as individuals and organizations that acquire good that have been sieved by the customs. The other one is the IRP which is often paid by all the public as well as private entities in Brazil. They charge rate is at 15% to 25%

· Excessive Bureaucracy

As per the WBDBR, the lengthy procedures, as well high costs of establishing a business in Brazil are quite discouraging. Moreover, establishing a business in Brazil will also require one to keep running around through several government agencies even after the business is already in operations. As such, the excessive procedures discourage the entrepreneurs extensively. Other challenges include:

· Challenges in obtaining support from BNDES

· Additional barriers as well as barriers, in exportation as well as importation business

· Recurrent modifications as far as norms as well as procedures are concerned.

References

Advogados, P. N. (2013). Doing Business in Brazil. Juris Publishing, Inc.

Becker, T. H. (2004). Doing Business in the New Latin America: A Guide to Cultures, Practices, and Opportunities. Greenwood Publishing Group.

Branco, S., & Williams, R. (2006). Brazil. Kuperard.

Nicol, J. (2012). Brazil Business Etiquette & Culture. Retrieved from InternationalBusinessCenter.org: http://www.cyborlink.com/besite/brazil.htm

Today Translations. (2017). Doing business in Brazil. Retrieved from Today Translations: https://www.todaytranslations.com/doing-business-in-brazil

Vasconcellos, I. (2016). DOING BUSINESS IN BRAZIL OPPORTUNITIES AND THREATS. Lulu.com.

WorldBusinessCulture.com. (2016). BUSINESS CULTURE IN BRAZIL. Retrieved from WorldBusinessCulture.com: http://www.worldbusinessculture.com/Business-in-Brazil.html