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Foxconn's Brazil Plan Stalled
hackingbear writes with an article from Reuters about Foxconn's plans to move iPad production to Brazil. From the article: "A much-hyped $12 billion plan for Taiwanese manufacturer Foxconn to produce iPads in Brazil, announced in April by President Dilma Rousseff during an official visit to China, is 'in doubt' due to stagnant negotiations over tax breaks and Brazil's own deep structural problems such as a lack of skilled labor and bad infrastructure, government sources tell Reuters. '(Foxconn) is making crazy demands' for tax breaks and other special treatment, the official added. Local media have reported that Foxconn is also seeking priority treatment at Brazilian customs, which is notoriously slow even by the standards of emerging markets."
I never believe corporate statements anymore.
Brazil is the next Dark Horse Country after China. But they totally managed to escape notice.
How is that!?
My first Journal Entry ever, in 8 years! http://slashdot.org/journal/365947/aphelion-scifi-fantasy-horror-poetry-webzine
Let us get this out of the way, since there is bound to have lots of posts similar to mine. I will make it short:
I am a Brazilian living in Brazil and it sucks...it really really sucks over here.
It's not like Brazil had any obvious advantages over China. Apparently they were relying on some special breaks from the government. Absent those, they're prolly better off staying in China.
American Third Position
Finally, a real choice!
If Brazil wants to play on the international markets, they'll have to do something about their customs procedures.
Tax breaks for companies moving into an area are pretty much standard nowadays, unfortunately. I wish I could demand tax breaks like corporations do.
I wonder if the Brazilian government is trying to pin Foxconn down to provide suicide prevention services before they're allowed to depress and demoralize the Brazilian employees.
I do not fail; I succeed at finding out what does not work.
Until corruption is fixed, the customs situation is positively addressed, protectionist tariffs and damn near ruinous taxation are removed Brazil needs to smolder in it's on shit for a couple of decades longer.
I'd go on a Vegan diet but the delivery time from Vega is too long. --brownkitty
Nah, Give them 7 years and they'll fix it.
Brazil is the Ultimate Dark Horse.
Buy in now!
My first Journal Entry ever, in 8 years! http://slashdot.org/journal/365947/aphelion-scifi-fantasy-horror-poetry-webzine
Why should the company have all the fun?
How about targeting incentives for the potential workers (that is, you target the people that would work there) instead of letting Foxconn make another hellhole?
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
This is the oldest story in the multinationalist's book.
It happens with every industry. If it's not physically restricted to a particular chunk of land like mining or timber, corporations will shop jurisdictions, wringing tax and legal concessions out of every potential home. It's why banks incorporate in Delaware who don't even have branches or clients there, why Microsoft does a suspiciously large amount of business in Ireland, etc.
By the time they're done shopping their future home has agreed that they'll be exempt from environmental laws or that they'll never pay taxes if they'll please just give a few thousand people a job. It's just another problem with the kind of pathetic regulation that allows a corporation to declare their profit in one nation, their liabilities in another, their employees in a third, etc. to the effect that they're no longer just people (which is bad enough) but highly privileged citizens of a dozen countries at once. Yet with so few of those pesky liabilities other citizens must endure.
I know slashdot has a large contingent of social darwinists and let-it-all-burn libertarians and I'll get modded down for this, but I have to say that I'm sure Marx is laughing in his grave watching us fulfill his nightmares.
Given how much corruption exists, there really isn't a legitimate way for it not to be bad over there.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Fix the corruption, keep the tariffs, and keep the taxes from being passed down to regular people over there.
Giving in to a company that wants to export Chinese thuggery isn't going to improve things.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Brazil is totally screwed for any high tech company. I work for a fortune 500 trying to expand into Brazil, one of our biggest problems has been finding enough skilled labor. We have actually started sniping good people from our vendors and decided to train them up
On top of that their customs sucks big time. We have had some things take weeks to get through customs. I am of the opinion that we shouldn't expand down there, but we are.
Overall, Brazil is more expensive to operate in than the US. Heck we can't maintain the standards of work and or product we have set in the US and other parts of the world (including other third world countries.) Then we can't find products that roughly match our requirements, so we have to import and pay the 50% tariff on them. It is way cheaper for us to do things in other countries
Really the Brazilian government is screwing their people over. If they were to get rid of that tariff and streamline their customs, more foreign companies would invest in brazil and it (Brazil) would come out of it's third world country feel. Oh, and they also need to clamp down on the corruption.
The US has the ability to enforce near-infinite jurisdiction, try using it on multinationals for once. If the multinational's efforts at arbitrage are thwarted at every step, including lobbying efforts, they will find themselves having to reconsider their actions.
It would be amusing to see a multinational try to make an argument on humanity because all the folks in their business continuity plan are all in Guantanamo Bay or some black site. Doubly so if the people that sent work offshore were in a prison that was next to their factory or call center.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
In all seriousness: I have a close friend with family in Brazil. Last time he was there, one of his uncles was talking about his job: he mines gold. I am not entirely familiar with the process, but he mixes mercury with water and ore with his bare hands to do... I am not sure what.
When my friend's jaw dropped and told his uncle that he was killing himself, his uncle just told him, in less polite words "you are a real pu$$y boy, aren't you?"
Point? I am sure as stressful as the conditions in a Foxconn facility may resemble slavery, it can't be worse than what many are doing to "stay alive" already.
Panama or Costa Rica would be much better.
"The average reporter we talk to is 27 years old......They literally know nothing." - Ben Rhodes
Clearly they need to get in touch with Elon Musk and start building these things in orbit. Right? Because it makes soooo much sense, right?
China's scientific output already surpassed UK's. It won't be long before Foxconn will open a factory in the US.
How about use some of that bailout money to move that plant down to South Carolina, give Foxconn all tax breaks they want and actually employ few AMERICANS.
Well, this kind of gold mining is not a common activity in Brazil. It's actually downright illegal but you can find a few miners doing this in remote areas, specially in the North, near the Guyana borders. I don't think the country is as bad as you seems to think it is. For sure, there's a lot of people living in the most abject condition, specially in North and Northeastern Brazil, but for most, it's just a normal country although a poor one. As a software developer I make more or less the same I'd make working in Southern Europe, for example.
Most of large electronics equipment manufacturers are located in the Manaus Industrial Park. I've had the chance to tour some facilities - both here and abroad - and safety conditions in most large Manaus employers are equivalent to what you expect elsewhere. Salaries are low, both so is the living cost. Work week is 44 hours and this is usually respected in industrial companies (overtime is common for professionals, almost everywhere in the world as far as I know). 30 paid vacation days per year, which is actually better than some other places.
The biggest problem, labor wise, in Brazil is law enforcement. The country is downright unable to enforce labor laws through the country. If you're working in a company that respects the law you're in a rather fine situation. If you don't have a job or have one outside "the legal economy" (like your friend family doing gold mining), then you're downright screwed.
Even then, there's universal health care and free public education everywhere. Quality is not that good, most middle or upper classes will have private insurance and schooling, but it's there including for everyone even expensive therapies (like HIV, or cancer, and so on) are included in the universal coverage.
In the end, I'm pretty sure that there are way better places to be. But it is not bad like you seem to think, and most people have way better conditions than being an almost slave in a Foxconn factory.
English is not my first language. Corrections and suggestions are welcome.
This is not commonplace here. Mining used to be bigger, but only in very few places.
Yes, small independent gold miners use mercury to separate the gold from the raw ore, and they use a blowtorch to evaporate the mercury afterwards. It's nasty for their health. It used to be common, but no more.
This is not to say that we don't have poverty. We do and we have a lot of it.
Still, Brazil is far from being like China, at least in the slavery department.
you don't need skilled labor, the Chinese proved that, all you need is a few thousand people willing to kill themselves for a shit job, and the ability to follow instructions
Brazil does produce, even if not in sufficient numbers, very good engineers, some of which are exported to developed countries. As far as "lack of skilled labor", one has to wonder if the salaries being offered by the Chinese company are on a par with those in the Brazilian job market. Perhaps it's not the lack of good Brazilian engineers, but good Brazilian engineers willing to receive Chinese salaries.
Brazil is a terrible country to have skilled tech labor. Whoever's idea this was is clueless about Brazil's people and culture. China blows them away, in part because only asians can endure and put up with the inhumane treatment of skilled laborer. Asians typically are very fast, hard working, and intelligent. Unless they are going to import these people into brazil I don't see how this will work, even if they get all the tax breaks in the world.
I am not entirely familiar with the process, but he mixes mercury with water and ore with his bare hands to do... I am not sure what.
Gold and mercury form an amalgam. The idea is to crush the ore, which is something like 0.001% gold, then mix it with mercury. The gold dissolves into the mercury and the rock doesn't. After you've run enough ore through the mercury you drain it out and heat it to boil off the mercury, leaving only the gold.
And yeah, he's killing himself. When you boil off the mercury it turns into vapor and does Very Bad Things to anyone who breathes it and also pollutes the hell out of the countryside. There are 150 year old mining sites in the western US that still have unsafe levels of mercury.
I called this shot 4 days ago, here on Slashdot ...
http://slashdot.org/comments.pl?sid=2446794&cid=37517716
Seriously, did anyone really believe this ? Look at the source. These guys (Mercadante et al) are 10x worse than your usual politician.
morcego
'(Foxconn) is making crazy demands' for tax breaks and other special treatment, the official added
No, Foxconn is asking for exemption from Brazil's fucking crazy taxes on any imported computers. Brazilians pay double what Americans do for a Mac, and those brain-dead protectionist tariffs apply to any factory equipment, too. Brazil could be an industrial giant to rival Japan or Korea, if they gave up these stupid Marxist ideas about "promoting local industry" by raising trade barriers.
Brazil's own deep structural problems such as a lack of skilled labor and bad infrastructure
I assure you, bad infrastructure is something we don't lack.
Circumcision is child abuse.
I'm an American that is moving to Brazil for the opportunities. The are in desperate need of skill people. While most of the country is still very much blighted there are many bright spots, but the brightest spot to me is the people. I have been all over the world and have never met a people that are as friendly and welcoming as a Basilero. Before I first went there all i heard was how it was such a dump with much violent crime. In the 2 Years that i have been there I have seen a huge amount of renovation and no violent crime and I live in Novo Mundo, Sao Paulo. The biggest problem I had was speaking the language as not very many people speak english. From what I have seen there I think this Foxconn deal was premature, their infrastructure just cannot handle a Tech company that large. Maybe in 5 more years.
So, Brazil is a huge country. No really, look it up again on the map.
For those questioning tech and education in Brazil - it works for a few (look at PUC RIO and 'Lua' the programming language, which had it's origins at Tecgraf, etc.), but yes there are a large percentage of the population with a basic working education that would shame even other third-world countries.
The words you have to learn the hard way to do business in Brazil: "Ladrao, propina; jetto; jetinho; caixinha; graxa; troco; nota; acerto"- it is a very corrupt place, at all levels of local and national Government. In the northern state of Bahia, in Feira de Santana, their local town hall has put in place plastic screens in their town halls, so when the local councillors have their public meetings, the locals can no longer throw their coins at them with the usual chants of "you are corrupt, here is so more money for you greedy politicos..".
This is a just a bargaining chip by Foxconn -- they know the have to play hardball with the Brazilians to get a low as possible set of rates and agreements defined now, because once they move in and start production you can guarantee every local politician, policeman, federal employee will be looking for ways to draw out little bits of cash from Foxconn via newly defined tariffs, laws, outright bribes, and other less satisfactory ways.
If Foxconn pays what is asked, it can do what it wants. They want a large part of the forest cut down? Done. Kick those people out of their homes to build the new plant? Done. Consume 80% of the local power in a zone that already has regular blackouts and will potentially now experience more? Done.
Brazilians would sell their own grandmother for a dollar. (then steal her back later to sell again...)
I thought the Manaus area workforce was mostly natives they made come down from trees and put some clothes on...
At least my former employer Manaus office is mostly manned by people from Southeastern or Southern Brazil but it's a software development company. I might be wrong today, since it has been a while since I was there. Industrial workforce it's probably most composed by natives. Anyway, skilled labor shortage is a serious problem. It became common to do some recruiting in Argentina or Uruguay since Brazilian salaries are way higher then theirs it's easy to hire, and there's no lack of skilled people in our Southern neighbors. I've seen some recruiting drives in Portugal and in Japan (mostly aimed at Brazilian expats).
English is not my first language. Corrections and suggestions are welcome.
Will Brazil's workers commit suicide, or kill their employers?
Can't wait to find out. Hopefully the latter because the former is just a waste.
Protip: When you do kill your employers, record it and share it on the internet.
Be seeing you...
http://www.foxbusiness.com/technology/2011/09/28/microsoft-to-produce-xbox-360-consoles-in-brazil/
"Even then, there's universal health care and free public education everywhere. Quality is not that good (...)"
That's pretty good euphemism. People who can only rely on public education and universal health care finish school without knowing how to read properly and die before they can receive an organ transplant.
Brazil has very employee-protective labor laws which make in impractical for a company such as Foxconn to work here, so they requested labor laws reforms from the government. Conceding in the labor laws area would be a very bad scar in the image of the current (theoretically center-left) Labour Party, so the deal didn't go through.
Brazil has no shortage of skilled labor. We do lack decent transportation infrastructure (only options are usually air or road, no train or water transportation). Also, our customs are very outdated, with absurd tariffs (which are also supported by the current government).
As a Brazilian, it was possible the deal was bound to never go through from day one.
That's pretty good euphemism. People who can only rely on public education and universal health care finish school without knowing how to read properly and die before they can receive an organ transplant.
Well, it's not that simple. There's a few outstanding public hospitals like the Sarah Kubitscheck Rehabilitation Network (Brasilia, Rio and Salvador, if I recall correctly) and INCA (Rio). HIV treatment is actually world class. The same goes for education, CAP/UFRJ, Colegio Naval are a few public schools that usually rank among the best schools in the country.
The biggest problem of SUS ("Unified Health System") is that is actually unlimited in coverage, but resources are limited. SUS is by law forced to offer even sex change operations, for example. Some plastic surgeries are also included. Reproductive medicine, too. In a world with limited resources this means that is actually stretched far beyond what it can accomplish. The best thing would be to scale back coverage and focus in essential needs.
Unfortunately this is impossible without a complete change of the Brazilian constitution and of the established legal practice. The concept of "direito adquirido", where if a person receives an entitlement for a good length of time it cannot be taken away, is widely accepted by judges. Any scaling back of social security benefits would be crushed in court. Brazil actually expends with social security, per capita, the same amount Sweden does. But the money is siphoned out of the system by corruption and by senseless benefits (a 20 years old married to a 80 years old is entitled to a life long pension after the 80 years old partner dies, even if the 20 year old is not financial dependent on the 80 years old.).
Another bad aspect of the Brazilian legal system is that the government is bound by law to "reduce inequality between states" which, de facto, means penalizing successful states with high taxes and expending an incredible amount of money in pork projects in the least successful states. Those pork projects are usually populist projects, allowing populist (and corrupt) politicians to gain votes. The same populist politicians will vote for more pork expending, perpetuating themselves into power.
The best for Brazil would be an all encompassing reducing of the scope of social benefits, driving populists out of the power, minimizing the amount expend on pork. Unfortunately no politician advocates that and the Workers Party administration is ever increasing the pork expending and government intervention on the economy. If things don't change soon, I'm thinking about just jumping ship and migrating somewhere else.
English is not my first language. Corrections and suggestions are welcome.