A special guest post by Global Security Consultant and Political Risk Expert, Paul Crespo. This is the fourth post in the series.
For ten years Brazil has been the darling of the emerging market countries: the “B” in BRIC (Brazil, Russia, India & China). With annual growth rates of 5 percent, its stock markets often doubled year to year. Brazil is hot. It will be hosting the World Cup next summer and the Olympics in 2016.
Recently however, many of the risks of doing business in Brazil have begun to dampen some of this enthusiasm. The economy has slowed considerably, and the summer’s mass protests that rocked dozens of cities across the country, reminded us that despite the tremendous potential, Brazil is still one of Latin America’s most dangerous places to do business.
Even before these protests, FTI Consulting had given Brazil a 4 on a five-point Latin American Public Security Index, with 5 being the most dangerous. That ranking placed Brazil on par with Bolivia, Colombia and El Salvador.
While recent police sweeps and crackdowns are having positive effects, Brazil still has some of the highest crime rates in the region. In any given year, 25 out of every 100,000 Brazilians were victims of murder or attempted murder. This is actually one of the highest rates in the world; the United States has 5.6 murders or attempts per 100,000 per year. Brazil also has high rates of kidnapping, rape, and theft. Much of Brazil’s crime is related to the drug trade.
Mega Events: World Cup, Pope’s Visit and Olympics
The unexpected mass protests in June raised concerns about Brazil’s ability to manage security risks in general, but specifically for mega events like the World Cup and Olympics. Fortunately, the June riots coincided with the Confederations Cup, a smaller scale, dry-run for the 32-nation World Cup next year. The Confederations Cup was held in six cities and provided the government and security services a perfect opportunity to test and improve their systems.
Overall, considering the scale of the protests and other risks, there were no major incidents, and the event gave Brazil added security practice in dealing with civil unrest and major events.
In July, the Pope’s visit again challenged Brazil’s security services with a massive event, this time however with less positive results. The Catholic Church’s World Youth Day brought an estimated 3 million people onto Copacabana beach in Rio to see the Pope. This mega