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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."
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.
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
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.
Maybe because the SC state government is about as fucked up as the one in Brazil and can't be trusted to honor the agreements they've signed? Like the one with Amazon?
Not to mention our 3rd world education system. The football coach at my son's high school makes twice what the teachers make. Five of the kids in my son's homeroom can't sign their own names. Some of that good Brazilian run would be nice right about now.
"The average reporter we talk to is 27 years old......They literally know nothing." - Ben Rhodes
Oh and you're not suggesting Foxconn is in Brazil for their stellar education, are you?
All right, mod this flamebait! Whatever!
If Brazil is a "dark horse", why does it attract so many investments? Why are so many foreign companies coming to Brazil and why did so many others came to Brazil decades ago?
Yes, we have corruption problems. So does Italy, Greece and a lot of so-called "first world countries".
We have poverty, but it's nothing like Somalia or Vietnam. We still have a long way to go until we catch up to american standards, where the poor are few enough to hide in the ghettos.
So, if you want to know more, just read about it.
Brazil is getting so much investment and attention lately for a very simple geographical reason. It is within timezones that make communication easier and more suitable to the American business day. Off-shoring of software development and IT to India has been a logistical nightmare and on top of that the best talent in India is commanding more and more money. The payoffs for offshoring to India are becoming smaller and smaller and the logistical problems are a leading cause for IT project failures associated with it. Brazil is easier to communicate with (corporations get preference on the international network), they have a large population of well educated IT professionals and cost of living is low so they are somewhat more affordable than equivalently skilled American talent.
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.
Because your transexuals are so much hotter than all the others.
Are you kidding? An ipad would probably cost $10,000 if it were made in the US.
Only the State obtains its revenue by coercion. - Murray Rothbard
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
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.
american standards, where the poor are few enough to hide in the ghettos.
lol wut
Contrary to the popular belief, there indeed is no God.
Then they will REALLY have a reason to complain about lack of skilled workers and corruption.
Contrary to the popular belief, there indeed is no God.
Many "Japanese" cars are made in the USA: http://www.cars.com/go/advice/Story.jsp?section=top&subject=ami&story=amMade0611
They are still reasonably affordable.
Brazil is not the next China, it is the next Africa. The Amazon is on the edge of collapse and they are about to try to build a dam project which is going to have serious ecological implications as well
As for why they WANT to move to Brazil, it has to do with shipping.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
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.
It's not necessarily admirable, since they are just copying existing processes, but they are getting attention that suddenly notices the parts that are still in a "pre-civil-rights" status.
Copying existing processes may not be innovative, but it's a whole lot better than just stagnating and staying a crappy third-world country. Yeah, their human rights record leaves a lot to be desired, but what about other countries like Myanmar, North Korea, and many more? At least China's actually improving, and at a pretty good rate too. 60 years ago, the US had a rather shitty human rights record too, at least for certain parts of the population. If China can improve in 20 years as much as the US did in 60 years, that seems like a pretty good achievement.
I think I used the wrong word. It IS admirable that they are leaping out of the middle ages, i just meant the path they are taking is not exactly, as you said, an innovative one.
I guess the perception of china is two fold. In one hand you have people that were born from parents that themselves were born with the current level of legally protected human rights. For these individuals, any country that has not given their citizens the same levels of human rights is "evil". To be honest, it's as silly of an expectation as saying monkeys are evil for not evolving into tool using animals. Despite globalization, china is it's own country with it's own "civil evolution".
The other point, is that China, is becoming the country equivalent of the "new rich" families dressing badly in a high class charity dinner, everyone starts talking about them even if the "new rich" family happened to be the wealthiest one. In similar fashion, when we see Chinese government do things we don't consider appropriate, we are very quick to judge.
Despite the current government imposed friction, I'd not be shocked (nor be alive to be) if China found itself in a better quality of living state than the United States within 100 years.
I'd not be shocked (nor be alive to be) if China found itself in a better quality of living state than the United States within 100 years.
That won't be hard. The US is in a downward spiral right now, and will have a lower quality of living most likely in 100 years than it does now. Just look at the Roman Empire: people in that region had a much better standard of living in 200 than they did in 600, and it took over a thousand years for Europe to get back to where it was during Roman times. That's sorta where we're headed now. We can only hope the other industrialized nations will be able to insulate themselves from the US's fall, but with the way things are going in Europe right now, it doesn't look good.
Some people really talk about what they don't know...
The goddamn dam is like 2,000 miles from Amazon!
I didn't believe xenophobia was a serious problem among IT professionals, which would have better knowledge than the average person.
Brazilians would sell their own grandmother for a dollar.
Wait... These are the jews!
(then steal her back later to sell again...)
No, wait again... These are the turkish!
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...
I am Brazilian, the currently economy growth, come mostly because goverment start to help poor people, with projects like "Bolsa Familia" which is a help of money (until R$173/month, less than a 100U$ for currently exchange) to help they eat and a project called "Minha Casa Minha Vida" which give money to buy new houses for less incoming people with subsiding interests. There are also a very huge investment in university education. But .....
Even, with high education or skill, does not mean that you can get basic level of life of an american or european with same level of income.
Brazil is expensive!
The big problem here is moral! And I cant see a cure for this.
Employers pay ridiculous salaries even they get millions of profits, they also evade a lot of tax.
Mostly justify their crime (of course, employers cant evade tax) saying that the politicians stole, or that they don't give good service from government.
But, these very very corrupt politician are elected using money from these un-honest companies and people.
Almost small and middle company evade tax.
The big group in congress are "Ruralistas" people that represent the interest of big rural owners, that mostly are in the middle age era.
Currently they are near to approve a new regulation in which they could throw away every tree that are remaining in the soil. .....
Link? I have no idea what either of you are talking about as I don't seem to get all that much news about South America (of which Brasil is only a small part...)
APK likes to ask for responses to the same things over and over. Maybe he just likes the responses?
Wikipedia's article about Brazil is a good start. Check the Geography section. You'll see that Brazil occupies almost 48% of South America. So, Brazil is not a small part of it at all.
Yes, the Amazon rainforest is shrinking day after day, but not even close to the "edge of collapse". There are better sources of information, but Wikipedia provides some, like:
"The mean annual deforestation rate from 2000 to 2005 (22,392 km2 or 8,646 sq mi per year) was 18% higher than in the previous five years (19,018 km2 or 7,343 sq mi per year).[37] Deforestation has declined significantly in the Brazilian Amazon since 2004.[38]"
Better laws, better enforcement and better pressure from NGOs like WWF has shown results. It could be better, but it's progressing.
There is one hydroelectric plant that the government is trying to get built since 1985, called "Belo Monte". Ecologists and native brazilians (our "indians") are trying to stop the government since then. I tried to google it, but I can't find any articles in English. This dam would be built in the Amazon, covering a very large area, but nothing as big as Tucuruí or Itaipú. The natives are complaining that the dam's reservoir will cover ancient cemetaries and stuff like that.
The dam I was talking about -- which I think is the only one being built right now -- is at the border between Rio and Minas Gerais, thousands of miles away from the Amazon.
I was specifically speaking of the dam, thank you for the enlightening though.
APK likes to ask for responses to the same things over and over. Maybe he just likes the responses?
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.