LATIN AMERICAN PERSPECTIVES 10.1177/0094582X03261184AraújoARTICLE / WHAT NORTHEAST? Northeast, Northeasts What Northeast? by Tânia Bacelar de Araújo Translated by Paulo Simões

This article focuses on the characteristics and direction of the economic activities of the Brazilian Northeast and their place within the national con- text and highlights some of the social ramifications of recent changes. “Northeast” is here defined as the geographic area that extends from Maranhão to ,1 and the period analyzed is from the 1960s to 1992. I first present a brief description of the economic growth of the Northeast, confirm- ing the influence it has had on broader national economic movements from the so-called Brazilian Miracle (1968–1973) through the deceleration of the late 1970s to the crisis of the 1980s and early 1990s, with the predominance of financial accumulation. Throughout this initial analysis, the region will be considered as a whole. I proceed with an attempt to increase awareness of the differences that exist within the Northeast, pointing to new areas of dynamism, different state and metropolitan trajectories, and areas of resistance to change. I go on to examine the most important regional and subregional economic relation- ships and to compare the Northeast and its subdivisions with other regions in and overseas. Social questions and the persistence of poverty in the Northeast will also be analyzed, taking into consideration the national con- text and internal regional differentiation. Given the importance of govern- ment action in shaping regional economic realities, the role of public policy will be examined with particular interest.

Tânia Bacelar de Araújo is a professor at the Federal University of . Paulo Simões is a graduate student in history at the University of California, Irvine. This article is a revised ver- sion of an article with the same title published in Araújo’s Heranças e urgências (2000). AMERICAN PERSPECTIVES, Issue 135, Vol. 31 No. 2, March 2004 16-41 DOI: 10.1177/0094582X03261184 © 2004 Latin American Perspectives

16 Araújo / WHAT NORTHEAST? 17

THE RECENT EVOLUTION OF THE NORTHEASTERN ECONOMY

The Northeast makes up 20 percent of the Brazilian territory, houses 29 percent of the country’s population, and produces approximately 14 percent of the nation’s total output (as measured by the gross national product [GNP]), 12 percent of the nation’s industrial production, and almost 21 per- cent of its agricultural production. It should be pointed out initially that 23 percent of the urban and 46 percent of the rural population of Brazil lives in the Northeast. In contrast, the Southeast, which is responsible for 38 percent of the nation’s agricultural production, contains only 21 percent of the coun- try’s rural population. As we shall see, the slow growth that for many decades characterized the Northeastern economy (GTDN, 1967) has been replaced by strong dynamism in the numerous activities that have developed in the region. Yet poverty—an ancient trait that the economic vitality of recent decades has not been able to alter significantly—continues to be one of the most important problems of the Northeast. A survey by the Instituto de Planejamento Econômico e Social (Institute for Economic and Social Plan- ning—IPEA) showed that in 1990, of the 32 million needy , 17.3 million (55 percent of the national total) lived in the Northeast. More than10 million lived in the region’s rural zone. Thus, with 46 percent of the nation’s rural population, the Northeast contained 63 percent of its rural poor. Of the nation’s urban poor, almost 46 percent lived in the Northeast (IPEA, 1993).

GENERAL GROWTH

Edited by in the late 1950s, the report of the Grupo de Trabalho para o Desenvolvimento do Nordeste (Study Group for the Devel- opment of the Northeast—GTDN), which established the initial plan of action of the Superintendência do Desenvolvimento do Nordeste (Northeast Development Agency—), revealed that in the preceding decades the most important characteristic of regional production had been its limited dynamism. While industry was driving the economic growth of the South- east, the old raw-materials/export sector of the Northeast was beginning to show its incapacity to sustain economic development. One of the central pro- posals of the GTDN report (as that document came to be known) was to stim- ulate industrialization in the Northeast as a way of overcoming the problems generated by its archaic agro-export base. Starting in the 1960s, impelled by fiscal incentives (principally inputs from the Fundo de Investimento no Nordeste and exemption from income 18 LATIN AMERICAN PERSPECTIVES taxes) and investments by large state enterprises such as Petrobrás (in Bahia) and the Vale do Rio Doce Company (in Maranhão), aided by public credit, mainly from the Banco Nacional de Desenvolvimento (National Develop- ment Bank—BNDES) and the Banco do Nordeste do Brasil (Northeastern Bank of Brazil—BNB), and with the resources of local, national, and multi- national enterprises, urban activities (especially industry) played an increas- ing role in the Northeast’s economy and drove its productive growth. Between 1967 and 1989, and the raising of livestock declined from 27.4 percent to 18.9 percent of the region’s GNP, though in 1990 (because of a drought that affected production in the semiarid region) this percentage dropped further to 12.1 percent. Meanwhile, industry grew from 22.6 percent to 29.3 percent and tertiary production from 49.9 percent to 58.6 percent, according to SUDENE’s statistics for the period. In the early 1960s, the recently created SUDENE concentrated its efforts and federal funds on researching the natural resources of the Northeast (par- ticularly mineral resources) and expanding the region’s economic infrastruc- ture (transportation and electrical energy, above all). These investments were important motivators for the subsequent growth of private investments in both the industrial and the tertiary sector. On the whole, the Northeast was the region with the highest level of GNP growth during the 1960s, 1970s, and 1980s. Between 1960 and 1988, the Northeastern economy surpassed aver- age national growth figures by 10 percent, and between 1965 and 1985 the GNP generated in the Northeast grew an average of 6.3 percent per year, more than that of Japan (5.5 percent per year) during the same period (Maia Gomes, 1991). Comparing the rhythm of the Northeast’s productive growth with that of the nation shows clearly that the poor performance that had prevailed until the 1950s did not continue in the following decades. During the 1960s and 1970s the productive activities of the Northeast accompanied the rhythm of Brazilian growth, and in the 1980s they demonstrated levels higher than the national average (Guimarães Neto and Araújo, 1990). Using data from the Instituto Brasileiro de Geografia e Estatística (Brazilian Institute for Geogra- phy and Statistics—IBGE) and SUDENE and comparing the performance of the total Brazilian economy with that of the Northeast, Duarte (1989) demon- strated a distinct improvement of indexes of the relative participation of the Northeast in the nation’s economy: between 1970 and 1987, the proportion of the GNP increased from 12.6 percent to 15.8 percent, per capita GNP rela- tive to the national average went from 45.8 percent to 54.4 percent, industrial production increased from 9.6 percent to 10.5 percent, and tertiary produc- tion increased from 12.4 percent to 15.8 percent. In addition, the share in the value of the tax on the circulation of goods and services of the Northeastern Araújo / WHAT NORTHEAST? 19 states relative to the Brazilian total rose from 9.2 percent in 1975 to 12.5 per- cent in 1987 (Duarte, 1989). Only in the case of livestock production did the Northeast show a decline in relation to the national average—from 22.5 per- cent in 1970 to 19 percent in 1990. This was mostly due, however, to the greater growth of other regions, especially the Midwest. In total, between 1960 and 1990 the Northeast’s total GNP increased by almost six times, from US$8.6 billion to US$50 billion (Araújo, 1992). Comparison of the economic performance levels of the Northeast with national averages reveals that regional growth tended to match the cyclical oscillations of the nation’s total production. During the “economic miracle,” national growth extended to the Northeast: regional GNP grew 7 percent in real terms between 1967 and 1973 while the Brazilian average was 11 per- cent. Even when, after the first oil crisis, the Brazilian economy decelerated, decreasing from a growth rate of 11 percent per year to little more than 7 per- cent between 1974 and 1980, the economic activities established in the Northeast grew 7.4 percent during the period. In the 1980s, however, when national production presented even more modest levels, Northeastern pro- duction, despite demonstrating less of a decline than that of other regions (especially when its industrial activities are compared with those of the Southeast), did not differ from the national pattern. In the early 1990s, the deepening recession promoted during the Collor administration affected both Brazil and the Northeast in the same manner. Economic integration caused by capital accumulation in previous decades had, as Oliveira (1990) and Guimarães Neto (1989) have shown, tied the eco- nomic growth of the Northeast to the general trend of the national economy. From this perspective, at this point one of the central theses of the GTDN report became obsolete: one no longer found a Northeastern economy mired in stagnation side by side with a strong Central South. Integration had brought together diverse regional economies. This integration did not, of course, homogenize the productive structures of the various regions of the country. Important differences remained. It is precisely because the produc- tive structures of the various Brazilian regions are different that the Northeast has been less affected by the economic crisis of recent years. The crisis has more sharply affected the industrial sector, especially those segments that specialize in capital goods and durable consumer goods. These segments did not have a strong presence in the industrial fabric of the Northeast. (, in contrast, specializing in the production of durable goods, was severely affected by the crisis.) Thus, by concentrating on the production of interme- diary goods destined largely for export, recently established industries in the Northeast were better able to resist the effects of the Brazilian recession. At the same time, at its western edge and along the banks of the São Francisco 20 LATIN AMERICAN PERSPECTIVES

River the Northeast developed the modernized production of grains and established a center of fruit production for export. This helped the regionto withstand the retraction in the internal market and made possible a more posi- tive local response to the national crisis. According to SUDENE (1992), the service sector also showed an increase in the Northeast, especially after the mid-1980s, and demonstrated annual growth rates higher than the national average.

THE NORTHEAST AND THE NATIONAL ECONOMY

In addition to an increase in its economic base, despite the deceleration produced by the national crisis, the Northeast’s economy has also experi- enced important changes in the composition of its production. In this sense, again, it has participated in the general trends of the Brazilian economy. Thus, from the years of the “economic miracle” to the early 1990s, the por- tion of the GNP represented by agricultural and livestock production in Brazil and in the Northeast suffered a relative decline. In both the nation and the region, urban activities advanced more steadily, though industry became relatively more important to Brazil in general (34 percent in 1990) than to the Northeast (30 percent). Because of this, compared with the total national economy, the Northeast in 1990 was a more important producer of agricul- tural (20 percent of the national total) than of industrial (12 percent) or ter- tiary (15 percent) goods (SUDENE, 1992).2 Changes have, however, taken place in the productive profile of North- eastern agriculture. Since the 1970s, there has been a reduction of the area devoted to cotton, castor beans, manioc, and sisal and an expansion of the area planted with , rice, cacao, beans, oranges, and corn. At the same time, because of relatively high market prices, products not tradition- ally grown in the region have assumed increasing importance in regional pro- duction, among them papayas, mangoes, watermelons, and grapes (in areas irrigated by the São Francisco), cacao and pineapples (in parts of the arid sertão and hinterland), and tomatoes, coffee, soybeans, and rubber (in parts of the São Francisco Valley, the agreste, the plains, and the forest, respectively). Though these products represented only 3 percent of the Northeast’s agricultural production in 1970, by 1989 they had grown in importance to 13.5 percent (Congresso Nacional, 1993). During the years in which the Brazilian economy was consolidating its national market and promoting productive integration, as we have seen, the Northeast participated in the national dynamic. Private capital was seeking new investment opportunities outside the most industrialized area of the Araújo / WHAT NORTHEAST? 21 country, the Southeast, and the decentralization of the nation’s productive activity, including industrial activity, affected the Northeast (Guimarães Neto and Araújo, 1990; FUNDAJ, 1992; Oliveira, 1990). As this movement was largely aimed at taking advantage of the resources of the various regions of the country, the Northeast began to sponsor important agricultural and industrial development projects. Particularly in the case of industry, the region took on a new role. From a traditional producer of nondurable con- sumer goods (textiles and food, principally) it was gradually transformed after 1960 into an industrial region specializing in intermediary goods (Araújo, 1981). Its many activities included the establishment of the petro- chemical center of Camaçari, in Bahia, the mining/metallurgical complex in Maranhão (as well as this state’s aluminum complex), the production of fer- tilizers in , and the SALGEMA complex in . As a conse- quence of this new role, the region’s industrial profile changed significantly, with a relative decline in the production of nondurable consumer goods and increased production of intermediary goods. Of industry financed by incen- tives from SUDENE, the segment producing primary goods received the largest share of resources. The region’s agricultural base was also directed toward the production of goods to be processed outside the Northeast and, in some cases, outside the country. Except for such products as tropical fruits, soy bran, and grapes (transformed into wine in the Northeast), an important part of the region’s agricultural and mineral production was sold for processing outside. In the 1970s, when the Brazilian government, following the strategies defined by the Second National Development Plan, implemented important public investment programs that sustained the growth of the national econ- omy even during a period of international crisis, the Northeast also benefited. It was at this point that Petrobrás established the petrochemical center of Camaçari and the Companhia Vale do Rio Doce inaugurated its complex at Carajás, with some of the investment going to Maranhão. Investments made by Eletrobrás are also worthy of mention. Of the total gross development of fixed capital, including investments by the public administration and by gov- ernment enterprises, the share of the Northeast increased from 13 percent in 1970 to 17 percent in 1985. Finally, as the crisis in Brazil deepened in the 1980s, except for its nega- tive effects on financial intermediation activities and on sectors devoted to exports the Northeast tended to reproduce this pattern. Between 1975 and 1990, Brazil’s exports more than tripled, from US$7.6 billion in annual sales to US$31.1 billion. The Northeast also produced more for overseas markets, doubling its total exported values from US$1.5 billion in 1975 to US$3 bil- lion in 1990. The state of Bahia is a special case, not only replicating the 22 LATIN AMERICAN PERSPECTIVES national pattern by tripling the value of its exports from US$525 million to US$1.5 billion but also increasing its already dominant position in the region’s total sales to the international market. In 1975 its economy gener- ated one-third of the Northeast’s exports; in 1990 it accounted for half of them. Financial intermediation has also demonstrated exceptional growth in the Northeast in recent decades. Even as the Brazilian economy slowed down, entering a recessive phase, financial investments in the country grew. In the Northeast we may observe the same tendency. Whereas in the 1970s and 1980s the regional economy grew by 7.6 percent per year on average, finan- cial activities, real estate, and services to businesses expanded 10 percent per year (SUDENE, 1992). While the economic activities of the Northeast tended to follow, in gen- eral, the main trends of the Brazilian economy, they retained certain impor- tant distinctions. One of these is the important role played in recent yearsby the public sector. The state has of course vigorously sponsored the economic growth of various Brazilian regions. In the Northeast, however, its presence has been the most important factor in determining the direction and intensity of growth in recent decades. According to SUDENE (1992), during the 1970s and 1980s the public sector directly or indirectly stimulated the growth of economic activities in the region, including real estate and business ser- vices, finance, electrical energy and irrigation, social and personal commu- nity services, and commerce. Together these activities added up to two-thirds of the regional GNP, and for many of them public investment was fundamen- tal. As a result, the public sector has on average had greater influence in the formation of fixed capital in the Northeast than in the nation as a whole. By investing, producing, subsidizing, and creating a social and economic infra- structure, the government has become a highly visible force in the promotion of the Northeast’s economic growth.

INTRAREGIONAL ECONOMIC HETEROGENEITY

In recent years, important economic movements in Brazil have had strong repercussions for the Northeast. Private initiatives backed by state support when not directly by the federal government have caused the emergence and development in the Northeast of various areas equipped with active modern economic structures—centers of growth that have in large part been respon- sible for the relatively positive performance of the region’s economy. These structures are sometimes mentioned in the specialized literature as “expan- sion fronts,” “poles,” or even “enclaves” of dynamic growth. Among these, Araújo / WHAT NORTHEAST? 23 special attention should be paid to industrial centers: the petrochemical com- plex of Camaçari,3 the textile and clothing centers of ,4 and the min- ing and metallurgical complex of Carajás.5 Agroindustrial centers are equally important: the irrigated farms of Petrolina/Juazeiro, the grain fields of Bahia (and now extending to southern Maranhão and Piauí), the modern fruit- growing do Norte region (especially the irrigated Vale do Açu), the livestock-producing backlands of Pernambuco, and the various tourist facilities established in the principal coastal of the Northeast. Policarpo Lima and Fred Katz (1993) have sought to identify these areas, describe and analyze their products, and examine their prospects of expansion. In addi- tion, we should also mention, less because of their growth than because of their modern technological innovation, the technical centers of Campina Grande in and in Pernambuco.

THE PERSISTENCE OF TRADITIONAL STRUCTURES

While various parts of the Northeast were modernizing, others were more resistant to socioeconomic change, particularly in the traditional cacao- and -producing areas and in the semiarid interior. Modernization in these areas, when it occurred at all, was restricted and selective, helping to main- tain a dominant traditional system. Cane production did expand significantly, subsidized in the 1970s by a program aimed at encouraging the production of alternative fuels () for the national market. But the rapid expansion of cultivation was achieved primarily by the annexation of lands rather than by the improvement of production methods. In the semiarid areas, the crisis of cotton (brought on by the boll weevil and by changes in demand caused by the new technological and business standards of a modernized textile industry in the region) have helped make the survival of enormous numbers of inhabitants of the dry agricultural and cattle-raising areas even more precarious and fragile. Traditionally, cotton was the primary (though declining) source of monetary income for small rural producers and laborers in these Northeastern areas. In its absence, these small producers have been forced to bring to market their meager surpluses of traditional dry-farming staples (corn, beans, and manioc), since the raising of livestock has always been the prerogative of large local landholders. It is no accident that in periods of irregular rainfall such that of recent years, traditional “emergency fronts” (as government aid programs are called) enlist enormous numbers of farmers (2.1 million persons in 1993). During years of regular rainfall, small farmers, renters, and sharecroppers in these areas produce without being able to accumulate a surplus. With little 24 LATIN AMERICAN PERSPECTIVES capital at the end of the harvest cycle, they are incapable of withstanding peri- ods of drought. In this case progress has not been significant. In general, the change that has taken place has mostly been negative (for example, the disap- pearance of cotton production). More positive has been the expansion of gov- ernment services that have helped part of the elderly population and ensured a minimum but regular income for many rural families. In cacao-producing areas, resistance to change, coupled with falling inter- national prices, has served to worsen the economic crisis. There are important similarities among areas in which the rigidity of old socioeconomic structures and the political dominion of traditional oligarchies have predominated. First, these are older areas of occupation, in which tradi- tional structures have successively created mechanisms of self-preservation. The question of land ownership is the most dramatic and is worsening. In the forest, for example, land concentration has increased in recent years, along with the appropriation of arable lands for the exclusive production of sugar- cane. In the semiarid zone, drought has increased the already high concentra- tion of lands in the hands of extremely few producers. As Andrade (1986) explains, “during droughts, small impoverished proprietors sell their hold- ings at low prices, and thus latifundia multiply.” Simultaneously, incentives for cattle raising have entrenched and modernized what has always been the principal activity of the typical productive unit of the Northeastern sertão and agreste. The increasing hegemony of cattle raising through the strengthening of traditional structures has not only aggravated land concentration but pro- voked other serious problems such as a reduction in the production of food- stuffs and the intensification of rural emigration. As was wisely observedby the geographer Melo (1980), “grass prevents food from being cultivated, and cattle drive people away.” Even where irrigation has introduced more modern agriculture in the semiarid area, the “modernization” has been conservative. Though technology has been modernized, land concentration has increased (Graziano da , 1989). Because in recent decades the Brazilian strategy has been to expand live- stock production to new areas (especially the Midwest), the Northeast has also witnessed significant growth in the agricultural and livestock industry in western Bahia and in southern Maranhão and Piauí, the old regional “agricul- tural frontier.” During the 1960s and in the following decades, proposals for agrarian reform were abandoned in practice by successive military and civil- ian governments and dismissed in many forums (including academic ones) as unnecessary because of the “successful” development of new lands. Northeastern oligarchies, proprietors of old landholdings and well situated in power structures, continuously benefited from this option. Araújo / WHAT NORTHEAST? 25

In this way, even after many years of economic growth, the problem of land concentration has remained practically unresolved despite the alarming misery found throughout the rural areas of the Northeast. Land concentration has worsened in the Northeast in the past few decades. In 1970, establishments with less than 100 hectares (94 percent of the total) occupied almost 30 percent of the land area. By 1985 this had fallen to 28 per- cent. At the same time, the proportion of the land area occupied by establish- ments with more than 1,000 hectares (0.4 percent of the total) increased from 27 percent in 1970 to 32 percent in 1985. According to an IBGE agricultural census, the total land area occupied in this period increased from 74 million to 92 million hectares. In the semiarid zone this situation is aggravated by the presence of major latifundia. There the average area of the largest 1 percent of establishments (1,914 hectares in 1985) is greater than that of those in the rest of the Northeast (1,002 hectares). Access to land is maintained through precarious means (sharecropping, for example) and unstable, and one findsa larger number of large landholders in comparison with the rest of the North- east (Graziano da Silva, 1989). Land concentration remains one of the pri- mary pillars of traditional socioeconomic and political power structuresin the area.

DIFFERENT STATE AND METROPOLITAN TRAJECTORIES

From the beginning, one should remember that there never has been an economically homogeneous Northeast6 and that historically it has been pos- sible to point to at least three distinct socioeconomic subregions with differ- ent processes of development: The “Northeast” extending from to Alagoas, where the sugar and livestock economies gave birth to two powerful oligarchies and an incipient industrial bourgeoisie. In this Northeast, stood out asan area in which cattle/cotton/food agriculture shaped a backland oligarchy that expanded into commerce and no sugar production complexes existed. The “Northeast” of Sergipe and Bahia, led by Salvador, a mercantile and port , where from early on a banking bourgeoisie developed. In the inte- rior, the sugar, cacao, and rural economies dominated. The Bahian west was economically and even demographically vacant until recent decades. The “Northeast” of Piauí and Maranhão, better known as a zone of transi- tion between the dry Northeast and the Amazon region, called by some schol- ars the “Mid-North” and seen as a potential area for regional agricultural expansion. 26 LATIN AMERICAN PERSPECTIVES

As has been emphasized, heterogeneity has increased in recent decades. The degree of success in many states of modern centers coexisting with tradi- tional economic structures has shaped different patterns of local growth. Between 1970 and 1990 some states (especially Rio Grande do Norte, Ceará, and Maranhão) gained relative economic importance because of new produc- tive facilities while the principal state economies (for example, Bahia and especially Pernambuco) declined. Even the three metropolitan regions (Fortaleza, Recife, and Salvador), though similarly affected by the process of and industrialization that has linked them with other industrial areas of the country, present differences. Government policies have strengthened unifying elements, and general processes such as oligopolization (Oliveira, 1981) have introduced elements uniting diverse local realities. Studying a representative sample of businesses established in the Northeast with governmental incentives, Oliveira (cited in Carvalho, 1989) has demonstrated that in 20 industrial subsectors the four largest companies concentrated more than 50 percent of the incomes in those subsectors. In addition, almost 80 percent of the total income and liquid wealth of the sample was held by 610 companies belonging to investment groups. At the same time, preexisting structures, the availability of local resources, and even the variability of dominant business profiles, among other ele- ments, have played a differentiating role. In Ceará, for example, a SUDENE- BNB study showed that there was significant cooperation between local and outside investors in the development of the new textile and fashion centers attracted to Fortaleza by federal fiscal and financial incentives. Local capital- ists made up 88 percent of the shareholders in companies financed by SUDENE. In Pernambuco and Bahia, where capital from outside the region predominated, this percentage was less than 34 percent. In these two states the relationship between local and outside capitalists was much less impor- tant, and because of this Pernambuco and Bahia received mostly businesses affiliated with companies directed from other regions and countries.7 In con- trast, the modern complex established in Fortaleza maintained a close rela- tionship to preexisting activities grounded in traditional Northeastern indus- tries: textiles and clothing manufacture. In this case, the new clothing production segment preserved an entire local artisanal tradition, that of lace making in Ceará. In the case of Recife, the metropolitan region expanded and diversified its industrial base with activities relatively new to Pernambuco, such as the pro- duction of electrical material. Though it continued to have the second-largest industrial base in the region, the state of Pernambuco lost its relative position in the Northeastern context principally to Bahia, Maranhão, and Ceará, Araújo / WHAT NORTHEAST? 27 especially between 1965 and 1985. The state had no important natural resource base that would have allowed it to participate in the national move- ment of industrial deconcentration (generally based on the processing of an abundant local mineral resource), and it lost an essential modern spinning complex and numerous weaving and clothing establishments to Ceará. A dif- ferential duty introduced by the adoption of a “zoning” system (with prefer- ential treatment directed at zone A, which excluded Recife) in the incentive policies administered by SUDENE between 1969 and 1985 made it difficult to locate such industries in the metropolitan region of Recife. Because of these impediments, Pernambuco’s participation in the industrial transforma- tion of the Northeast declined from 35 percent in 1970 to 24 percent in 1985 (SUDENE, 1992). In recent decades, also, as the rate of productive integra- tion has advanced, the internal market has consolidated its foundation on increasingly national bases, and road systems and modern telecommunica- tions have increased the accessibility of distant parts of the nation, the metro- politan region of Recife has been losing one of its most important traditional functions as an intermediary wholesale entrepôt. Because of this, commer- cial activity has suffered in this .8 Tertiary growth in this metropo- lis has, however, shown a potential for modern development of activities in the service sectors: specialized medical services, consulting services, marketing, and insurance, as well as financial intermediation. The growth of the metropolitan region of Salvador has also presented unique characteristics. The indirect effects of the petrochemical centerof Camaçari have extended well beyond the borders of this principal metropoli- tan area of the Northeast. Other industrial sectors, such as the metallurgical, have been expanded and modernized, though chemicals have remained the main component of the fabric of local industry. The growth of important civil construction companies has been much more pronounced in Salvador than in other Northeastern cities. The modernization of agriculture in Bahia has also played a complementary role, since income from the sector has been directed toward Salvador. The city has developed quickly, and there has been a great expansion of real estate capital. In the 1980s, especially, Salvador also bene- fited from the solid growth of the financial sector, a traditional presencein this metropolitan area. Observation of the rhythm of growth of the productive bases of the various Northeastern states reveals the existence of distinct trajectories, some more dynamic than others. In the small states of Sergipe, Rio Grande do Norte, and Alagoas, industry gained a strong presence, in 1990 representing between 34 percent (Alagoas) and 40 percent (Sergipe and Rio Grande do Norte) of their respective total production. In the principal states of the Northeast, industrial activity represented approximately 28 percent of their GNP in 1990. Tertiary 28 LATIN AMERICAN PERSPECTIVES activities also showed a tendency to increase in relative importance for vari- ous state economies, especially in Maranhão and Bahia. Sergipe and Rio Grande do Norte differed from the trend, with the relative importance of the tertiary sector declining from 54 percent to 45 percent and from 55 percent to 54 percent, respectively, between 1970 and 1990. In the state of Maranhão, the tertiary sector was relatively more important (64 percent); in Sergipeit was less so (45 percent), with the average for the region being 58 percent in 1990, according to data from SUDENE. In agriculture, drought remained a problem. During the dry spell of 1981–1983, agricultural production showed a general decline, with the exception of Bahia. (Here, agroindustrial growth in the west compensated for the negative effects of the drought that took place east of the São Francisco River.) According to SUDENE, the general growth rates of the various states were very different between 1970 and 1992. In both total GNP and per capita growth, Rio Grande do Norte, Maranhão, and Ceará showed the best results. The slowest growth in GNP was in Pernambuco and Paraíba. In per capita terms, Bahia and again Pernambuco were the states with the least variation throughout the period. Finally, the majority of states improved their positions in relation to the country’s total productive output. Only in Paraíba, Pernambuco, and Alagoas did this not occur. The most evident case was that of Bahia, which increased its relative share of the GNP from 3.8 percent to 5.2 percent between 1970 and 1985.

REGIONAL AND SUBREGIONAL ECONOMIC RELATIONSHIPS

RELATIONSHIPS WITH THE NEW INDUSTRIAL COMPLEX

The new industrial complex initiated in the 1960s with the help of federal incentives9 has maintained a close economic relationship with other Brazil- ian regions, particularly the Southeast, while depending for 66 percent of its raw materials and 58 percent of the services it consumes on its Northeastern economic base. Recent specialization in intermediary goods has reinforced this relationship,10 but the new industrial complex has developed an impor- tant flow of purchases of services and goods from the Southeast (especially São Paulo) as well. Of the services it utilizes, 40 percent come from the Southeast (90 percent of these from São Paulo); of the raw materials it pro- cesses, 17 percent are produced in the Southeast (two-thirds in São Paulo). Only 10 percent of the materials that are here transformed by subsidized industry come from abroad (SUDENE, 1992). Araújo / WHAT NORTHEAST? 29

In terms of sales, the predominant relationship is extraregional, especially with the Southeast and São Paulo. Of sales conducted by subsidized indus- tries, little more than one-third has been destined for the Northeast itself (36 percent). Their principal destination has been the Southeast, which buys 44 percent of subsidized industry’s production (71 percent of this by São Paulo). The international market represents only 10 percent of total purchases from this segment of the Northeastern economy. The predominant production of intermediary goods by the new industry has been the cause of this outward movement: most of the raw materials produced are processed in the biggest industrial area of the country, the Southeast. The extractive mineral sector, in particular, directs only 20 percent of its production to the Northeastern mar- ket and exports the rest, again predominantly to the Southeast, which in recent decades has consumed 53 percent of the minerals produced by federally subsidized industries. The priority given to exports has been a distinguishing mark of, for exam- ple, the businesses established in the mineral-metallurgical complex of Maranhão. It is no coincidence that the Grande Carajás Project included not only the strategic building of almost 900 kilometers of railroads but the con- struction of the Ponta da Madeira port in the area of São Luis do Maranhão. Another example of this special relationship with the outside is the ALUMAR project in Maranhão, projected to produce 3 million tons of alu- minum oxide and 500,000 tons of aluminum annually, 95 percent of which are currently exported (Lima and Katz, 1993). According to a SUDENE- BNB (1992) study, the extraregional market is also the main destination of Northeastern processed products: 99 percent of beverages, 88 percent of rub- ber products, 87 percent of leathers and furs, 76 percent of electrical materi- als, and 61 percent of chemical products are directed to outside markets. At the same time, 49 percent of the equipment utilized for the assembly of this new industrial complex was brought from the Southeast, most of it (80 per- cent) from São Paulo and 33 percent from abroad. Only 10 percent of this equipment was acquired from Northeastern businesses (SUDENE-BNB, 1992). Even so, commercial flows of merchandise and services in recent decades have intensified the exchanges between Northeastern subsidized industries and other segments of the national and foreign economies.

RELATIONSHIPS WITH MODERN AGROINDUSTRIAL CENTERS

The new agricultural centers have also established important extra- regional economic relations, particularly with international markets. Soy- bean production in western Bahia and southern Maranhão and Piauí is directed in large part to foreign demand. In 1992 it was estimated that western 30 LATIN AMERICAN PERSPECTIVES

Bahia alone would by 1995 be producing 1.7 million tons of soybeans per year, with 1 million tons of derivatives destined for international markets (Queiroz, 1992). Production in Maranhão and Piauí is also basically oriented overseas. This Northeastern subregion, which extends from western Bahia to southern Piauí and Maranhão, has been developed predominantly by outside capitalists who have transformed the landscape into one very similar to that of the Brazilian Midwest. Its economic relations and its geo-socioeconomic similarities with the rest of the Northeast have been very tenuous. Even the obstacles to this area’s continued development (such as the lack of a transpor- tation infrastructure) are more like those of or than like those of other parts of the region east of the São Francisco River. Expanded relations with the Midwest in the future will depend on the degree to which the transport network unites this subregion. One may observe, therefore, along with the growth and the logic of accu- mulation at the national level, the increasing economic integration of the area with other parts of the country (Lima and Katz, 1993). Likewise, agroindus- trial production, especially that resulting from irrigated projects in the Vale do São Francisco (in Bahia and Pernambuco) and in the Vale do Açu in Rio Grande do Norte, has also developed important extraregional economic relations.

CHANGES IN COMMERCIAL RELATIONS

Examination of the commercial growth of the region shows that the Northeast has shared the general tendency of the Brazilian economy as a whole to respond to crisis, instability, and decrease in internal demand by amplifying its commercial relations overseas. The state of Maranhão increased its modest export value of US$5.7 million in 1975 to US$443 mil- lion in 1990. The states of Piauí and Sergipe increased their sales to the inter- national market by five times during this period, and Bahia and Ceará tripled theirs. The only exceptions to this trend were the states of Alagoas and Pernambuco, whose exports in 1990 were less than those in 1975. Once again following the general pattern of the Brazilian economy, com- mercial relations between the Northeast and the rest of the world involved the sale of basic products and, increasingly, semimanufactured and manufactured products. Although its semimanufactured products (30.1 percent) were in 1990 already more important than in Brazil in general (16.5 percent), the increased sale of Northeastern manufactured goods to overseas markets is notable. Between 1975 and 1990 total Brazilian manufactured exports increased from one-third to more than one-half (54.7 percent); in Araújo / WHAT NORTHEAST? 31 comparison, the proportion of manufactured exports from the Northeast jumped from 12.9 percent to 44.9 percent. Only the Southeast and the South presented higher regional rates in the sale of manufactured goods (64.3 per- cent and 47.4 percent, respectively). The South was the second-largest exporter of manufactured goods (18.9 percent of the total national value), compared with 71.8 percent for the Southeast and 8 percent for the Northeast. However, this information is insufficient for evaluating economic and commercial relations between the Northeast and other regions of the country. In Brazil commerce is predominantly conducted by means of highways, and here the available data have not been updated. SUDENE has estimated that in 1980 one-third of all Northeastern exports were destined for the international market and two-thirds for other Brazilian regions. Of this total, 97 percent traveled on internal roads and only 3 percent as coastal cargo. Of total imports, only 18 percent came directly from overseas, and of the 82 percent of goods brought from other regions of the country to the Northeast, 85 per- cent arrived by road (SUDENE, 1985). Northeastern commercial balances have historically shown positive relations with overseas markets but highly negative interregional ones. In 1980 imports from other regions (especially from the Southeast) were almost five times greater than foreign imports, while exports to the rest of the country represented a value less than twice that sent to foreign markets. The Northeast has emerged, then, predominantly asa market region (above all for the Southeast) when seen from a national per- spective, and this tendency has noticeably increased. Whereas in the 1950s purchases from other regions represented only 1.2 times sales to other parts of the country, between 1975 and 1980 they represented 2.5 times such sales (SUDENE, 1985). SUDENE statistics for 1980 reveal that in Bahia the economy was strongly oriented toward the national market: almost 70 percent of Northeast- ern sales to other Brazilian regions originated in Bahia, whose economy at the time represented a little more than 40 percent of the region’s GNP. This was a strong but recent development, as in the previous decade Bahia had been responsible for only 25 percent of interregional exports (SUDENE, 1985). Despite a more modest showing, the state of Ceará demonstrated a similar trend, for its participation in Northeastern sales to the rest of Brazil grew from 3.5 percent in 1975 to 9 percent in 1980, making it the region’s second-largest exporter to the national market. The opposite occurred with Pernambuco, whose share of regional international exports fell from 30.3 percent to 8.4 percent during the same period (though the state’s economy made up 20 percent of the Northeast’s total). This tendency could also be observed, to a lesser degree, for Paraíba, Rio Grande do Norte, and Alagoas. 32 LATIN AMERICAN PERSPECTIVES

Together these four states represented 40 percent of exports to other partsof the country in 1975 and only 16.4 percent in 1980. In that year, their com- bined GNP made up only 36.6 percent of the region’s total. Since the development projects of the 1980s most intensely affected parts of Maranhão, Piauí, Ceará, Bahia, and Sergipe, their strong economic rela- tions with other Brazilian regions would not be expected to have been altered, and indeed commercial relations between the westernmost section of the region with the Midwest and the Southeast expanded as they had throughout the 1970s. In the states of Rio Grande do Norte, Paraíba, Pernambuco, and Alagoas, the decline in commercial relations with the rest of the country that had begun in the previous decade does not seem to have been reversed during the 1980s. One explanation may be that these easternmost areas had become relatively isolated from the broader tendencies of recent national economic growth. If this inclination toward isolation is confirmed, the people of this region will face even greater limitations in solving their social problems.

INTEGRATION THROUGH THE MOVEMENT OF PRODUCTIVE CAPITAL

The intensified movement of productive capital in Brazil in recent decades has also affected the Northeast. In the report that led up to the cre- ation of SUDENE, Celso Furtado correctly argued that one of the problems of the Northeast in the 1940s and 1950s had been significant migration of productive capital to the Midwest as industrial growth in that region created opportunities for profitable investment (GTDN, 1967). Beginning in the 1960s, the rapid oligopolization of the Brazilian economy and the role of the “conveyor belt”—as Oliveira (1981) called it—created by federal incentives in the Northeast altered the direction of this economic movement and inverted it. What happened was what many writers have called the “regionalization” of big capital (private and state) that is now occurring throughout the country (Brando, 1985). The growing presence of large business interests in the Northeast, as in other regions, is not restricted to the industrial sector. Civil construction motivated by the Sistema Financeiro da Habitação (System for Housing Finance—SFH) and by important public works projects and agroindustrial complexes (especially those related to the production of grains, fruits, sugar- cane, and livestock) has also recently shown a marked presence. Capital is being centralized in commercial activity, and oligopolization is being firmly established by great supermarket and chain stores throughout the country.11 Between 1975 and 1990 the Northeast increased its share of the country’s 5,000 largest companies from 12 percent to 18 percent, mostly in activities Araújo / WHAT NORTHEAST? 33 related to livestock production (from 12 percent to 37 percent), mining (from 11 percent to 19 percent), general services (from 6 percent to 12 percent), and transportation and warehousing (from 3.5 percent to 6 percent) (Guimarães Neto, 1993). It should be pointed out, however, that the presence of big capital in the region is very selective both spatially and in the types of activities to which it is directed. Statistics on the proportion of the country’s 1,000 largest compa- nies located in the region show that in 1990 the majority (75 percent) of these companies were concentrated in Bahia (46 percent), Pernambuco (18 per- cent), and Ceará (11 percent).12 Industries producing intermediary goods, especially the chemical industry, were best represented. According to Guimarães Neto (1993), “Of the 105 larger enterprises with affiliates in the region, approximately 35 are industrial companies that produce intermediary products, and of these 23 are chemical industries.” Other sectors deserving mention are the food and textile industries. Another revealing finding has to do with the control of capital in the mod- ern industrial segment established in the Northeast with the aid of federal incentives. A SUDENE-BNB study (1992) shows that recent industrial expansion is not the result of the initiative of regional investors who, relying on federal incentives, have diversified their production, expanded or modern- ized their companies, or opened new productive units. On the contrary, the majority of subsidized companies have been part of regional and extra- regional financial interests. Beyond this, the study showed that extraregional interests direct and control the largest subsidized industrial enterprises. Northeastern businessmen control smaller companies producing nondurable consumer goods. In the production of intermediary goods and durable con- sumer goods, greater control is exerted by private groups or by state enter- prise systems headquartered in the South and the Southeast (Guimarães Neto and Galindo, 1992). Consequently, interregional articulation through the movement of productive capital has connected the Northeast to other regions of the country in the recent decades.

THE SOCIAL DIMENSION AND THE PERSISTENCE OF POVERTY

As in the rest of Brazil, changes in the principal social indicators reveal that in recent decades there has been an improvement in the general quality of life in the Northeast, especially during the 1970s, but this improvement has been at a much slower rate than productive growth. While the Northeast’s GNP tripled from US$20.8 billion in 1970 to US$65.3 billion in 1993 (as 34 LATIN AMERICAN PERSPECTIVES measured in that year’s prices by SUDENE), per capita production barely doubled in the same period (increasing from US$740 to US$1,486). This is an important indication that the improvement in the standard of living was not a result of economic growth, for per capita GNP hides one of the North- east’s most serious problems: the great concentration of wealth and therefore of regional income. Indicators such as per capita production and life expec- tancy in the Northeast have not only improved in recent years but have come to approximate national averages. According to SUDENE (1992), the ratio of product per Northeastern inhabitant was 43 percent that of the Brazilian average in 1970, increasing to 55 percent in 1990. According to the IBGE (1992), life expectancy at birth for the Northeast was 84 percent that of the Brazilian average in 1970 and 91 percent in 1988. Despite these findings, however, statistics show that the social situation in the Northeast is the worst in the country. Per capita GNP remains the lowest in Brazil, and life expec- tancy (58.8 years in 1988) is the lowest of all Brazilian regions, being only84 percent that of the southern Brazilians whose average standard of living is the highest in Brazil. In other social indicators, no approximation to the national average has occurred. In terms of education, domestic access to water, and infant mortal- ity indexes, for example, the situation of the Northeastern population has worsened in comparison with that of the rest of the nation. Between 1970 and 1989, the numbers of uneducated persons above 15 years dropped from 55 percent to 36 percent, but in other regions of the country this decrease was much greater. In the early 1990s, therefore, the region was in a relatively more unfavorable situation at a time when education was becoming a more strategic variable. Whereas infant mortality rates among Northeasterners declined from 151.2 per 1,000 live births in 1970 to 80 per 1,000 in 1988, these levels were 29 percent higher than Brazil’s in 1970 and 68 percent higher in 1988. Only in the North was this trend comparable during this period, though much less intense. In terms of domestic access to water, the Northeastern situation also declined relative to the nation. Though the avail- ability of water in the region increased from 9.7 percent to 42 percent of homes between 1970 and 1989, the disparity between Northeastern and Brazilian figures also increased. The Northeast continues to pose great social challenges: the region con- tains 29 percent of the Brazilian population but 55 percent of the nation’s illit- erate persons (IBGE, 1992), 55 percent of the indigent (IPEA, 1993), 45 per- cent of the poor (with a per capita income of less than half a minimum wage), and 50 percent of the nation’s population with a low caloric intake. Though the Northeast has 26 percent of Brazil’s economically active population, it Araújo / WHAT NORTHEAST? 35 has 36 percent of those receiving less than twice the minimum wage and only 15 percent of the nation’s workers who contribute to the national social secu- rity system. According to the IBGE (1992), only 29 percent of the employed population in the Northeast contributed to the system as opposed to 50 per- cent of Brazil’s total workforce in 1989. At the same time, the percentage of fully registered Northeastern workers (42 percent) was very much lower than the Brazilian average (60 percent) in 1989.

INTERNAL SOCIAL DIFFERENCES

Just as for economic growth, social progress in the Northeast has been unequal, and general trends have not been reproduced in identical ways in all states or even between rural and urban areas. Wealth in the Northeast is highly concentrated, and social contrasts are enormous. In recent decades the dynamism and modernization of production established in the region have been more intense and profound than the improvement in the quality of life for most Northeastern inhabitants. Economic growth has insufficiently reduced social inequality, and the crisis of recent years has only aggravated the region’s social condition. Estimates of income concentration in the Northeast reveal a worsening of already high levels of concentration (the Gini index rose from 0.596 to 0.638 between 1970 and 1988). While the poorest 40 percent saw a reduction in their share of the region’s income from 8.8 percent in 1970 to 7.8 percent in 1988, the richest 5 percent increased their portion from 38.8 percent to 42 percent in the same period (Albuquer- que and Villela, 1991). Likewise, Tolosa’s study (1991), which defined the poor as persons with less than one-fourth of a family’s minimum wage per capita, revealed that in the Northeast poverty had deepened: from 19.4 mil- lion in 1970, the number of poor persons increased to 25.8 million in 1988. The most growth took place in urban areas, where the poor population climbed from 6 million to 10 million, while in rural areas the number remained stable at approximately 13 million. One reason for the aggravation of social conditions in the urban zones of the Northeast is migration. Emigration serves as an “escape valve” for social tension. Between 1960 and 1980 an estimated 4 million Northeasterners (almost the entire populations of Recife and Salvador combined, according to 1980 statistics) left the region. The economic crisis of the 1980s seems to have inhibited emigration to other regions; instead, the flow of migrants has been to urban centers within the region, rapidly increasing the numbers of shantytowns in medium-sized and even small cities of the Northeast. 36 LATIN AMERICAN PERSPECTIVES

Social problems in the rural areas have become even more serious than in the cities. By Tolosa’s (1991) definition three out of every four rural Northeasterners (75 percent) live in poverty, as opposed to one of every two urban ones (46 percent). In the most traditional rural areas of the Northeast, social inequality is severe. In the forest the irregular availability of jobs (high during the harvest and low during the planting and growing seasons) creates adverse conditions for the majority of the workforce, today predominantly made up of boias-frias (contingent workers) who can find work only for six months out of the year. Child labor remains a strategy for supplementing family income, and illiteracy is extremely high among sugarcane workers (according to one study, as high as 80 percent in some locations). In the semiarid region, drought continues to cause serious social problems, leading practically the entire population of rural workers and subsistence producers to seek government aid with every lengthy dry season, as occurred in 1993. Differences exist not only between urban and rural areas but between dif- ferent states of the Northeast. First, there has been a sharper increase in the concentration of wealth in states in which recent economic growth has been relatively more intense, such as Maranhão, Ceará, and Bahia, than in Pernambuco and Paraíba, where the economy did not grow much after the 1970s. In Ceará, the richest 5 percent own the largest percentage of the state’s income (46 percent); in Piauí, the poorest 40 percent share the smallest pro- portion of that state’s income (6 percent). Second, there are per capita differ- ences in production. In 1992 the average income in Piauí was half that of Bahia, the states with, respectively, the smallest and the largest per capita GNP in the region. (This was an improvement over 1970, when Piauí’s pro- ductive level was only 42 percent that of Bahia’s.) Utilizing the most common social indicators to analyze living standards, we may observe other distinctions between the states. In terms of education, infant mortality rates, and life expectancy, Bahia showed the most favorable conditions in the region, while in Pernambuco (where education rates are also high relative to other states) access to water and energy were also posi- tive. At the other extreme, the state of Piauí presented the most precarious social conditions. Paraíba and Maranhão followed, access to water and energy being very restricted in Maranhão and Paraíba possessing the highest infant mortality rate and the lowest average life expectancy in the Northeast. As is apparent from these statistics, there has been no linear relation between recent economic growth and improvement in standards of living for the populations of these states. Despite important common characteristics, social realities also reveal a heterogeneous, complex, multiple, and differenti- ated Northeast. Araújo / WHAT NORTHEAST? 37

OLD AND NEW ACTORS

In light of recent social and economic transformations in the Northeast, it is necessary to identify the classes and traditional social groups that have remained important and the emergence of new social actors. A study by the sociologist Inaiá de Carvalho (1989) examines this subject, one that has not been dealt with fully in the literature on the region. The first important find- ing of her study is the intense increase in recent decades in the number and proportion of salaried workers (greater than what we find for Brazil as a whole) among those employed in the Northeast. This index shows the increase in proletarianization, even in the countryside, both in older areas involved in such activities as sugar production and in new ones involved in modernized production. A modern proletariat is also appearing in urban areas, employed in industry (e.g., the petrochemists of Camaçari) and in ter- tiary activities (e.g., the employees of financial and computer companies). In the urban middle classes, interesting changes may be observed. While some groups (such as public employees) have become poorer, others have pro- gressed (as is the case with, for example, computer processors, doctors, administrators, consultants, marketing technicians, executives of large financial companies, and employees of large state enterprises). One may also observe a recycling of the old oligarchies. Newer genera- tions are diversifying the activities of older family-based businesses (moving into urban activities such as civil construction, processing industries, tour- ism, and commerce). This recycling appears to be rooted in subsidies, incen- tives, and favors of various kinds granted by the Brazilian government to one of the strongest conservative bases in the country. A few changes in the urban elite also deserve attention. From the intense industrialization of the 1970s and subsequent decades new industrial businessmen have emerged, particu- larly in the principal metropolitan areas of the region. In some cases, local businessmen have affiliated themselves with nationwide companies whose investments in the area have contributed to the “regionalization” of big capi- tal. The industrial elite of Ceará is generally cited as an example of this new type of social actor. A portion of the Bahian middle class has also gained strength by investing in modern sectors, some in petrochemicals and others in civil construction, commerce, or real estate activities. New actors, many of whom are not even Northeastern, may also be identified in emerging areas of livestock or agroindustrial production. Investors from São Paulo, , , and Paraná are involved in the new activities of regions of western Bahia and southern Maranhão and Piauí and in other irrigated areas. 38 LATIN AMERICAN PERSPECTIVES

Even the tertiary sector, including the so-called informal sector, needs to be reexamined. Recent data reveal that independent small businessmen not affected by unemployment present higher monthly wage levels than their counterparts in the so-called formal sector of the economy. The underem- ployed sector remains important in Northeastern urban areas, but within it professionals are emerging who specialize in tertiary activities and modern economic activities. Therefore, even in this sense, Northeastern realities have changed and become more complex and differentiated. It has become impossible to com- prehend this new reality on the basis of traditional stereotypes.

CONCLUSION

Analysis of the growth of economic activities confirms what a number of studies of the Northeast have shown. Various factors have promoted eco- nomic integration in recent years, welding diverse regional dynamics together. The Northeast—understood as an autonomous region, the locus of an independent movement of capital accumulation—no longer exists, but it is not alone in this. In Brazil, in this new context, regional economies no longer exist, having been replaced by a national economy, regionally located. National economic growth has linked preexisting regional dynamics. Spe- cific characteristics persist, but general economic behavior has imposed similar directions and movements. In the Northeast these movements have created new areas of expansion that today contain modern and dynamic structures. These coexist with tradi- tional economic areas and segments, shaping a diversified and complex regional reality. From this perspective, one may speak of various “Northeasts”: a Northeast consisting of western Bahia, a Northeast made up of the sugar- producing coast from Rio Grande do Norte to Alagoas, an agroindustrial Northeast along the São Francisco River, a cacao-producing Northeast in southern Bahia, a mineral, metallurgical, and agroindustrial Northeast in Maranhão, and a semiarid Northeast dominated by traditional dry farming and cattle herding. Each of them has its specificities and its particular actors, many of them even non-Northeastern. Many of the data (though often incomplete) on recent interactions with the Northeast have demonstrated the tendency of new economic relationships to “drag away” important parts of the region.13 If this is true, the “Northeast” will simply be that section that has recently demonstrated a tendency toward relative isolation. In this case, certain questions may be posed: Is Maranhão part of the Northeast? Is Bahia still in the Northeast? Where does the Araújo / WHAT NORTHEAST? 39

Midwest end and the Northeast begin? (Perhaps on its western “side”?) Aren’t southern Maranhão and Piauí and the Bahian plains more similar to Tocantins than to Pernambuco? Do these questions apply only to the Northeast?

NOTES

1. This region corresponds to the Northeast considered as the area of jurisdiction by SUDENE and does not, therefore, include the arid areas of the state of . 2. One should remember that before the “Brazilian miracle” in 1967, the agricultural impor- tance of the Northeast for the country was even greater (26.5 percent) and that its presence in national industry and the tertiary sector has increased in recent years. In 1967 the Northeast con- tained 9 percent of the nation’s industry and 12 percent of its services (SUDENE, 1992). 3. The center at Camaçari significantly altered the structure of the Bahian economy,increas- ing the importance of the secondary sector from 12 percent in 1960 to almost 30 percent of the state’s GNP in 1990. In 1989, direct employment (25,000 jobs) plus jobs related to support ser- vices (31,000) represented 19.6 percent of all employment generated by the transformation industry in the state. 4. The textile and clothing center of Fortaleza has also emerged as one of the important cen- ters in this sector, both regionally and nationally. Between 1970 and 1985, the number of textile establishments in Ceará grew from 155 to 358, while those related to clothing manufacture increased from 152 to 850. In 1991, according to the Sindicato da Indústria de Confecções do Ceará (Clothing Manufacturer’s Association of Ceará), the region contained over 3,000 busi- nesses, generated 60,000 direct jobs, and was responsible for 12 percent of the state’s tax on the circulation of goods and services (Lima and Katz, 1993). 5. The mining and metallurgical complex of Maranhão was made possible by the efforts of the Programa Grande Carajás (Great Carajás Program) and by the interest of multinational capi- tal in diversifying access to raw materials. By the 1980s these investments had shown important results: Maranhão’s GNP grew from US$2 billion in 1980 to US$3 billion in 1987, with the industry’s participation in the state’s productive total showing an increase from 14.3 percent to 21.8 percent. 6. In its demographic census of 1920, the IBGE defined the North and Northeast as one region. For a long time the Northeast was included in an even broader geographic area, the “Northern .” 7. This greater articulation and the increasing economic presence of new urban business segments in Ceará were at the root of the political rupture experienced by local society starting in the mid-1980s. 8. Besides the metropolitan region of Recife, other, smaller centers have also suffered the effects of this loss of wholesale trade. (in Pernambuco) and Campina Grande (in Paraíba) are examples. 9. The 910 industries subsidized by SUDENE make up almost half of the industrial produc- tion of the Northeast and generate one-third of the industrial jobs in this region. 10. According to a SUDENE study of subsidized industry until 1978. Before large complexes producing intermediary goods came to predominate, the complex purchased almost half (48 per- cent) of its materials outside the Northeast, 36 percent from the national market, and 12 percent from abroad (Araújo, 1981). 40 LATIN AMERICAN PERSPECTIVES

11. Not to mention financial capital, which has also been subjected to intense centralization and increasing dissemination throughout the country. 12. The growth of large enterprises was greater in Bahia. In 1975 Bahia and Pernambuco had practically the same number of large companies; by 1990 Bahia had one and a half times more such companies (49 as opposed to 19 in Pernambuco), according to the Revista Visão: Quem e Quem na Economia Brasileira. 13. Throughout the 1970s the Northeast opened itself up more to the rest of the country than internationally (exports through internal highways and as coastal cargo increased in GNP terms, while exports abroad declined). Yet, while imports from other regions decreased, those from abroad remained the same (SUDENE, 1985).

REFERENCES

Andrade, Manoel Correia de 1986 A terra e o homen no Nordeste. São Paulo: Atlas. Albuquerque, Roberto C. and Renato Villela 1991 “A situação social no Brasil: balanço de duas décadas,” in A questão social no Brasil: Fórum nacional. São Paulo: Nobel. Araújo, Tânia Bacelar de 1981 “Industrialização do Nordeste: intenções e resultados.” Paper presented to the Interna- tional Seminar on Regional Disparity, Recife. 1992 “Nordeste, Nordestes.” Revista Teoria e Debate, no. 3. Brando, Maria de Azevedo 1985 “A regionalização da grande indústria do Brasil: Recife e Salvador na década de 70.” Revista de Economia Política 5(4). Carvalho, Inaiá M. 1989 Nordeste: Discutindo transformações recentes e novas questões. Fortaleza: UFCE/ NEPS/Mestrado em Sociologia. Congresso Nacional 1993 “Desequilíbrio econômico inter-regional brasileiro: relatório final da Comissão Mista sobre o Desequilíbrio Econômico Inter-Regional Brasileiro.” Mimeo, Brasília. Duarte, Renato 1989 “Crescimento econômico: dinâmica e transformação da economia nordestina na década de 70 e nos anos 80.” Revista Econômica do Nordeste 20: 339–375. FUNDAJ (Fundação Joaquim Nabuco) 1992 “Desenvolvimento desigual da economia brasileira.” Mimeo, Recife. Graziano da Silva, José (ed.) 1989 A irrigação e a problemática fundiária do Nordeste. Campinas: Instituto de Economia, PRONI. GTDN (Grupo de Trabalho para o Desenvolvimento do Nordeste) 1967 Uma política de desenvolvimento econômico para o Nordeste. 2d edition. Recife: SUDENE. Guimarães Neto, Leonardo 1989 Introdução à formação econômica do Nordeste. Recife: Editora Massangana. 1993 Regiões e grandes empresas no Brasil: Un estudo exploratória. Recife: CNP9. Araújo / WHAT NORTHEAST? 41

Guimarães Neto, Leonardo and Tânia Bacelar de Araújo 1990 “Nordeste: a persistência da pobreza (relatório de pesquisa para estudo sobre a pobreza do Brasil).” Mimeo, UNICAMP, São Paulo. Guimarães Neto, Leonardo and Osmil Galindo 1992 “Quem controla o que na indústria incentivada do Nordeste.” Cadernos IPPUR/UFRJ 6(1). IBGE (Fundação Instituto Brasileiro de Geografia e Estatística) 1992 Anuário estatístico. . IPEA (Instituto de Pesquisas e Economia Aplicada) 1993 O mapa da fome: Subsídios à formulação de uma política de segurança alimentar. Edited by Anna Maria Pelliano. Brasília. Lima, Policarpo and Fred Katz 1993 “Economia do Nordeste: tendências recentes das áreas dinâmicas.” Mimeo. Maia Gomes, Gustavo 1991 “Uma estratégia para acelerar o desenvolvimento do Nordeste.” Mimeo, CME/PIMES/ UFPE, Recife. Melo, Mário Lacerda de 1980 “Os .” Estudos Regionais, no. 3. Oliveira, Francisco de 1981 Elegia para uma re(li)gião. 3d edition. Rio de Janeiro: Paz e Terra. 1990 “A metamorfose da arribação: fundo público e regulação autoritária na expansão econômica do Nordeste.” Novos Estudos CEBRAP, no. 27. Queiroz, Luiz N. de 1992 “Corredores de transportes para os baianos.” Carta da CPE, no. 12. SUDENE (Superintendência do Desenvolvimento do Nordeste) 1985 Importações e exportações do Nordeste do Brasil, 1974/80. Recife. 1992 Produto e formação bruta de capital no Nordeste do Brasil 1965/91. Recife. SUDENE-BNB (Banco do Nordeste do Brasil) 1992 Relatório de pesquisa sobre o desempenho da indústria incentivada no Nordeste. Recife. Tolosa, Hamilton 1991 “Pobreza no Brasil: uma avaliação dos anos 80,” in J. P. Reis Velloso, A questão social no Brasil. São Paulo: Nobel.