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Brazil & Lusophone Africa FUNDAÇÃO GETULIO VARGAS ESCOLA BRASILEIRA DE ADMINISTRAÇÃO PÚBLICA E DE EMPRESAS MESTRADO EXECUTIVO EM GESTÃO EMPRESARIAL BBRAZIL & LUSPHONE AFRICA: A STUDY OF HISTORY, INTERNATIONAL RELATIONS, & INTERNATIONAL TRADE DISSERTAÇÃO APRESENTADA À ESCOLA BRASILEIRA DE ADMINISTRAÇÃO PÚBLICA E DE EMPRESAS PARA OBTENÇÃO DO GRAU DE MESTRE THOMAS SUTTON Rio de Janeiro - 2014 Ficha catalográfica elaborada pela Biblioteca Mario Henrique Simonsen/FGV Sutton, Thomas Brazil & Lusphone Africa: a study of history, international relations, & international trade / Thomas Sutton. – 2014. 143 f. Dissertação (mestrado) - Escola Brasileira de Administração Pública e de Empresas, Centro de Formação Acadêmica e Pesquisa. Orientador: Istvan Karoly Kasznar. Inclui bibliografia. 1. Relações internacionais. 2. Relações econômicas internacionais. 3. Comércio internacional. 4. Brasil – História. 5. Países de língua portuguesa – História. 6. Brasil – Relações exteriores – Países de língua portuguesa. 7. Países de língua portuguesa – Relações exteriores – Brasil. I. Kasznar, Istvan Karoly. II. Escola Brasileira de Administração Pública e de Empresas. Centro de Formação Acadêmica e Pesquisa. III. Título. CDD – 327 2 3 ACKNOWLEDGMENTS The opportunity to have participated in the Corporate International Master (CIM) sponsored by Georgetown University (GU), Escuela Superior de Administración y Dirección de Empresas (ESADE), and La Escola Brasiliera de Administraçao Pública e de Empresas of the Fundaçao Getulio Vargas (EBAPE/FGV) has been a very unique and rewarding experience. I would like to extend my personal thanks to my family for their patience and support during a challenging but very knowledge filled year full of international experiences. I would like to thank my mother and sisters for their support of my academic pursuits; and also my father Henry Sutton for his unconditional support in all of my academic and professional pursuits – may he rest in peace. Thanks are extended to Georgetown University (GU) particularly Professor José Guerrero, Professor Paul Almeida, Dr. Marc Busch, and Dr. Mike Ryan, all other professors and GU CIM Program staff. Many thanks to Professor Pedro Parada, Lucia, Martha Torres, and all other professors and staff of ESADE that provided CIM Cohort Number 1 with a comprehensive global business management experience during the Madrid, Spain residency. Lastly, to EBAPE/FGV and Professor Marco Tulio Zanini, Profesora Carmen Pires Migueles, Dr. Paulo Figuereido, Dr. Hélio Reis; and my final project/thesis advisor Dr. Istvan Karoly Kasnar for the guidance and knowledge shared about corporate finance and international economics, and about Brazil, Angola, and Mozambique. Also, thanks to Teodóra for all of her assistance during CIM Program residency in Brazil. In closing, many thanks to all of our CIM classmates: Agosto, Anish, Arthur, Brian, Codie, Chris, Clay, Deidre, Fabio, Helio, Johnny, José Luis, Juan Carlos, Karim, María , Martha Julia, Saddiqa, Santiago, Markus, Olumfumni, Vanessa, and Vicente for making the CIM Program a valuable academic and professional learning experience. Best of luck to everyone! Sincere Regards, Thomas Sutton 4 Political Maps of Africa and South America1 5 Political Map of Africa2 6 TABLE OF CONTENTS List of Relevant Acronyms & KeyTerms ............................................................................................ 1 1 INTRODUCTION & OBJECTIVE ................................................................................................ 4 2 HISTORICAL OVERVIEW OF COUNTRIES ............................................................................. 6 2.1 BRAZIL ................................................................................................................................ 6 2.1.1 Political Map of Brazil ................................................................................................... 6 2.1.2 History and Overview of Brazil ..................................................................................... 7 2.2 ANGOLA ............................................................................................................................ 14 2.2.1 Political Map of Angola ............................................................................................... 14 2.2.2 History of Angola ........................................................................................................ 15 2.3 MOZAMBIQUE ................................................................................................................. 17 2.3.1 Political Map of Mozambique ..................................................................................... 17 2.3.2 History of Mozambique ............................................................................................... 18 3 COUNTRY PROFILES ................................................................................................................ 20 3.1 COUNTRY PROFILE: BRAZIL – República Federativa do Brasil ................................. 20 3.2 COUNTRY PROFILE: ANGOLA .................................................................................... 24 3.3 COUNTRY PROFILE: MOZAMBIQUE ........................................................................... 27 4 EMERGING MARKETS – AN OVERVIEW ............................................................................. 30 4.1 Characteristics of Emerging Markets Economies (EMEs) – Understanding EMEs ........... 31 4.2 Understanding Emerging Market Economies (EMEs) ........................................................ 31 4.3 Emerging Market Countries & Economies - BRICS .......................................................... 34 4.4 Emerging Markets - Africa ................................................................................................. 37 5 INTERNATIONAL TRADE & INTERNATIONAL TRADE THEORY ................................... 44 5.1 International Trade Theory.................................................................................................. 44 5.2 The Ricardian Model and the Theory of Comparative Advantage ..................................... 48 5.3 International Trade Model Consideration – Gravity Model................................................ 55 6 INTERNATIONAL TRADE AGREEMENTS ............................................................................ 56 7 REGIONAL TRADE AGREEMENTS (RTAs) ........................................................................... 62 7.1 Regional Trade Agreements - Economic Community of Western African States (ECOWAS) .................................................................................................................................... 65 7.2 Regional Trade Agreement - Economic Community of Central African States (ECCAS) 71 7 7.3 Regional Trade Agreement – Southern African Development Community (SADC) ......... 75 7.4 Regional Trade Agreements – Mercado Común del Sur (MERCOSUR) ........................... 81 7.5 Mercado Común del Sur - South American Common Market (MERCOSUR) .................. 81 8 INTERNATIONAL TRADE POLICY & DEVELOPING NATIONS ........................................ 86 8.1 International Trade Policy and Developing Nations ........................................................... 86 8.2 OPENNESS TO INTERNATIONAL TRADE................................................................... 90 8.2.1 Angola .......................................................................................................................... 91 8.2.2 Brazil ............................................................................................................................ 92 8.2.3 Cabo Verde .................................................................................................................. 92 8.2.4 Guinea-Bissau .............................................................................................................. 93 8.2.5 Mozambique ................................................................................................................ 93 8.2.6 São Tomé e Príncipe .................................................................................................... 93 9 BRAZIL AND AFRICA - INTERNATIONAL RELATIONS .................................................... 94 9.1 BRAZIL & LUSOPHONE AFRICA: Foreign Direct Investment (FDI) & International Trade 105 9.2 INSTITUTIONS SUPPORTING BRAZIL’S FOREIGN RELATIONS INITIATIVES . 112 9.3 & INTERNATIONAL TRADE WITH AFRICA ............................................................. 112 9.3.1 AGENCY FOR THE PROMOTION OF EXPORTS & INVESTMENTS (APEX- BRAZIL) .................................................................................................................................. 112 9.3.2 & THE NATIONAL ECONOMIC & SOCIAL DEVELOPMENT BANK (BNDES BANK BRAZIL) ...................................................................................................................... 112 10 CONCLUSION ........................................................................................................................... 115 11 REFERENCES ............................................................................................................................ 118 12 END NOTES ............................................................................................................................... 128 8 List of Relevant Acronyms & KeyTerms3 ACRONYM/TERM DESCRIPTION ABC Agência Brasiliera de Cooperaçao (ABC). The Brazilian Cooperation Agency (ABC). ADBG African Development
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