3Qs: The ‘perfect storm’ that led to Brazil’s drastic and rapid decline

In 2009, when Rio de Janeiro was named the host city for the 2016 Summer Olympics, Brazil was in the midst of an economic boom that had helped the nation become the rising star of South America. But little more than a half-decade later, the fifth-largest country in the world by population is plagued by political scandal, an economic downturn, and rising security risks, all of which raise questions as to Rio’s aptitude to host the games.

vicino150Thomas Vicino, associate professor of political science, public policy, and urban affairs at Northeastern, has traveled to and worked in Brazil extensively. Here, he explains the “perfect storm” that led to the country’s decline and weighs in on the city’s preparation for the Olympics.

How do you believe Rio has handled the preparation and lead up to the Olympics?

When Rio was awarded the Olympics in 2009, Brazil’s economy had witnessed unprecedented growth in the wake of the global recession. The globalization of cities, fueled in part by commodities exports from Brazil, created an economic boom for this developing country. Progressive social policies lifted some 40 million people out of poverty, creating one of the largest middle classes in the world since 2000.

It is important to note that Brazil is arguably the first democracy in the developing world to host the Olympics. This brings quite a few challenges: building new infrastructure, creating economic opportunity, reducing economic inequality and violence, cleaning up polluted waters, and navigating complex political and bureaucratic systems.

The preparations have been ongoing and slow at times. The primary challenge was to make Rio de Janeiro a safe city. Brazil has one of the highest homicide rates in the world, and rampant crime in Rio needed to be dealt with in a systematic fashion. Also, Brazil is one of the most economically unequal societies in the world. The consequences of such trends reach all corners of a city like Rio. One in six residents live in a favela, or “slum,” the informal housing developments that rise on the mountainous landscape of Rio. The government developed a plan to pacify the favelas through military occupation. I conducted research on this, and published a paper about the effects of this strategy.

Rio has also drawn on its military police force to provide security during the Olympics. Some 85,000 police are stationed on the streets and at the games, which is double the force from the London Games. The second challenge was to improve the transportation network to accommodate new growth. Metro lines were extended, and the historic downtown of the city was renewed. The third challenge was to clean up Guanabara Bay. These efforts have lagged due to the overwhelming costs of the clean-up.

How did Brazil find itself in such political and economic turmoil after being considered the crown jewel of South America just a few years ago?

It is the result of a “perfect storm” of social, economic, and political circumstances. Brazil’s economic growth of the 21st century has been erased over the past two years due to a deep economic recession. Exports slowed, inflation increased, and unemployment soared. The Real, Brazil’s currency, reached its lowest point in the currency’s history.

Political instability also exacerbated economic uncertainty. A corruption scandal at Petrobras, Brazil’s state oil company, revealed a systematic kickback scheme of money laundering that has implicated hundreds of politicians. President Dilma Rousseff’s approval rating dipped into the single digits, and she was recently removed from office while she awaits trial. Since 2013, millions of Brazilians have organized in the streets of cities to demand social change and political reform.

Finally, the outbreak of the Zika virus has scared tourists and locals alike—though it is now winter in Brazil and there are few mosquitos in Rio, presenting a relief to many.

Brazilian society remains very divided over the path forward. A recent poll showed that a majority of residents feel like the Olympics will do more harm than good for their country.

What can other cities learn about economic planning and development from what has happened in Rio?

Hosting mega-events is not a panacea for enduring socioeconomic conditions like inequality and poor quality public services such as health and education. Long-term planning is essential for creating pathways that link the successes of the events to the well-being of residents. Political stability is paramount. Institutions must be strong, transparent, and accountable. The case of Rio de Janeiro demonstrates this well. The games will go on, but it remains to be seen how the residents of Rio will benefit in the long term in a sustained way.