More than keeping up with deep and constant digital transformation, investing in Brazilian industry is a way to ensure a more sustainable future, recognizing Brazil’s importance on the global stage.
The country currently holds, according to CNI, a 2.1% share of industrial production worldwide. Furthermore, industry accounts for 20.4% of Brazil’s GDP.
This is also a sector that generates thousands of jobs and represents 69.2% of exports of goods and services.
In this sense, it is extremely important to recognize the progress of investments in Brazilian industry, especially in technology, which has assisted in the pursuit of an even more connected future for all.
Types of Industry in Brazil
The Industrial Revolution, as in all countries, had a major impact on Brazil, causing the vast majority of goods and services consumption today to originate from manufacturing plants.
Thus, it is necessary to recognize the importance of industry and understand the diversity that exists within this segment, which is represented by:
1. Production Goods Industry
This type of industry represents companies dedicated to the production of resources and raw materials used by third parties, meaning those that are transformed into a product for the final consumer. Examples: mining companies, timber companies, oil companies, metallurgy.
2. Capital Goods
This category includes industries that help other factories perform their roles by supplying resources, machinery, and equipment.
There is a high degree of production complexity in this scenario, as most industries need these instruments to enable their production processes, services, and other activities requiring support.
Also called intermediate goods industry, examples in this segment include: mineral and metallurgical products, textiles, pulp and paper, chemicals, rubber, plastics, electrical and electronic components, etc.
3. Consumer Goods
In Brazilian industry, there are also consumer goods industries, which represent those that transform raw materials into a final product and offer it to the consumer.
In other words, they are responsible for producing food, technologies, clothing, medicine, beverages, and other product categories that offer endless possibilities to the final consumer in search of solving a problem or need.
Other Types
There are also other modalities in Brazilian industry that align with the sector of activity or production. Among them are:
- Extractivism;
- Energy production;
- Civil construction;
- Information industry.
Advances in Brazilian Industry
According to data from the Institute for Industrial Development Studies (IEDI), Brazilian industry improved its position in the industrial production ranking covering 45 countries, including China and Italy.
This advancement represented 5.2% in the first quarter of 2021 compared to the same period of the previous year. As a result, Brazil now occupies the 13th position, ahead of countries such as the United States, Japan, and France.
In the same period of the previous year, for example, Brazilian industrial production had fallen by 2.5%, leaving the country in 24th place, which in 2019 was even lower, at 38th. In other words, 2021 represents a very significant improvement.
Impacts of the Pandemic
Since the beginning of the pandemic, Brazil and other countries have been impacted by mobility and activity restriction measures, which still persist in some countries. In 2019, Brazil was already facing a slowdown in global trade, in addition to crises in neighboring countries.
Furthermore, at the beginning of 2021, the country lost the standing it had achieved at the end of 2020, bringing reduced momentum and some points of concern, since actions such as emergency aid and vaccination are not yet fully balanced.
However, there are measures to be taken even within the pandemic scenario and beyond, whether to keep up with the technological transformations of the industry or to improve production capacity.
How Investment in Technology Can Boost Industry
In this sense, investment in technology is one of the main points to be understood and, above all, overcome, since many companies still view this scenario as representing new expenses.
First, Brazilian machinery is quite old compared to the world’s major economic powers. This equipment averages 17 years of age, which can pose certain disadvantages.
The current market demands adaptations and new approaches to issues ranging from simple to complex. Therefore, it is necessary to understand this modern scenario, which requires more assertive and rapid decision-making.
Needs have increased, as has the number of companies offering disruptive solutions. Consequently, the competitive market becomes more aggressive, especially for outdated businesses.
Technologies and Industry 4.0
To continue advancing, it is necessary to invest in technologies and Industry 4.0, as this type of investment has proven very effective for company profitability, even amidst the unstable pandemic scenario.
Therefore, Brazilian industry needs to look toward more connected operational systems, artificial intelligence technologies, and big data.
Technology proves to be more than a sure investment; it is an urgent necessity for those wishing to remain in the competitive market, which is currently transforming faster and faster.
As a result, there is an even broader scenario than in the First Industrial Revolution, because today data represents one of the most important business assets.
Want to better understand this context? Click here and access our e-book on the 4th Industrial Revolution, which has brought new opportunities to Brazilian industry.
