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Foxconn's Brazil Plan Stalled 153

Posted by Unknown Lamer
from the brazilian-workers-rejoice dept.
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."
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Foxconn's Brazil Plan Stalled

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  • 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!?

    • by Tharsman (1364603)

      Because China is starting to actually develop into a civilized country. They are going through an accelerated modernization process. They are doing what the US took about a century in about 10 years, and they are doing it all in large scale.

      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.

      Brazil is still the same Brazil it was years ago and from what I hear is only regr

      • by Grishnakh (216268)

        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 p

        • by Tharsman (1364603)

          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 ex

          • by Grishnakh (216268)

            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 w

    • by drinkypoo (153816)

      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.

      • 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.

        • by Coren22 (1625475)

          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...)

  • Brazil (Score:4, Interesting)

    by Anonymous Coward on Friday September 30, 2011 @07:40PM (#37573494)

    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.

    • Yeah sorry AC, sux to be you, but globally I have a 20 year watch on Brazil.

  • 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.

    • by tmcb (2136918)

      Brazil has a very protectionist economy. In the last 20 years (roughly), for every multinational enterprise that manifests some interest in settling on the country, lengthy rounds of negotiation are taken, mostly for discussing tax incentives.

      • by Anonymous Coward

        Brazil is not so protectionist anymore like in the 50's and 60's. Like we use to say, Brazil is "spreading the legs" to foreign companies.

        Contrary to what have been said in some other comments, foreign companies get tax breaks and huge incentives to come here. Some of them get free land and, in places where there's no infrastructure (power, water, etc.), the government provides it for free. Our president's "Worker's Party" strongest campaign argument was "creating jobs for the people".

        Brazilian companies ge

        • by Alex Belits (437) *

          5% per month interest!!

          That's 80% interest per year -- such a loan is impossible to pay unless someone is selling drugs.

          • by menkhaura (103150)

            Pal, I live here, and this country is surreal; I can attest that what the GP told is true. 5% per MONTH, only that's not for businesses, that's for people. Enterprises pay a little less.

            • by Alex Belits (437) *

              Then no one can use those loans for anything legitimate, and businesses have to accumulate capital on their own, 19-century-style.
              Not to say that it doesn't work at all, but if this is the policy in the whole country, it can only work along with heavy protectionism because then locals won't be able to compete with foreigners who can grow faster because they have access to loans.

      • The main problem I'd that Brazil is missing the boat here big time. Apple wants Foxconn in Brazil so they can sell iThings IN BRAZIL for reasonable prices... That's the whole point of the extortionist tariffs and customs process... And their government is screwing up the deal.

        I mean iPads, in the western hemisphere again... That's a big industrial coup even if it is Brazil.

    • by chord.wav (599850)

      It's not like Brazil had any obvious advantages over China.

      May I suggest a few keywords that might change your mind?
      Rio [topnews.in]
      Havaianas [abduzeedo.com]
      Carnaval [whitegadget.com]
      Garotas [desktopnexus.com]

      • by keeboo (724305)

        It's not like Brazil had any obvious advantages over China.

        May I suggest a few keywords that might change your mind? Rio [topnews.in] Havaianas [abduzeedo.com] Carnaval [whitegadget.com] Garotas [desktopnexus.com]

        This is exactly the kind of garbage that make people abroad think that Brazil is only about Carnaval, women, beaches and Amazon forest.
        And who often propagate that are people from Rio de Janeiro (an overrated shithole) and Northeastern Region.. Which are the most violent and underdeveloped parts of Brazil.

      • by fbobraga (1612783)
        coisa escrota... deve ser de carioca mesmo....
  • 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.

    • 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?

  • 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.

    • Nah, Give them 7 years and they'll fix it.

      Brazil is the Ultimate Dark Horse.

      Buy in now!

    • 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.

  • What's New? (Score:5, Insightful)

    by RobinEggs (1453925) on Friday September 30, 2011 @08:05PM (#37573706)
    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.
    • Hardly anybody denies that Marx was an absolutely brilliant analysts. I've even heard a Cato speaker say just that--that Marx very accurately pinpointed a lot of the problems with the economies of his day (some aspects of which remain today).

      What I think you're really getting at, is that Marx wrote about what we might today call "social dumping." That is, like water, production flows around the globe to the point of least resistance. India has cheaper lumber than the US, global production of lumber will be

      • > why shouldn't they?

        Because "countries (or states)" muck everything up when they meddle in the economy. Brazil is historically no exception.

        Why should a chinese sweat shop get to play by looser rules than a native-born small business? How will the native industry ever be able to compete if their own government creates artificial disadvantages for them?

        • Because "countries (or states)" muck everything up when they meddle in the economy. Brazil is historically no exception.

          By that argument, they should just open the borders to anyone and everyone. In which case you'll likely see their home industry almost entirely owned by foreign corporations in a few decades at most.

          • That is not a bad proposition. Open all the doors and let foreigners compete with brazilians on equal stands. The only problem is that the foreigners wouldn't allow that. They can't lose their competitivity.

        • That's somewhat silly. Inviting in foreign companies -- and then copying them -- is exactly how China got where they are today.

          Countries "meddle" in the economy when the impose taxes, regulations, change interest rates, regulate trade, regulate immigration, etc. Obviously not all of that is bad! Who is talking about sweat shops playing by looser rules?

          I lean strongly to the libertarian, but your viewpoint is much harsher than mine!

          • impose taxes, regulations, change interest rates, regulate trade, regulate immigration...
            I lean strongly to the libertarian,

            I think none of those activities are especially popular among libertarians. Some may be ok with tariffs, some may like immigration regulated. Virtually none of them want trade regulated, none of them want government dictating interest rates.

            Who is talking about sweat shops playing by looser rules?

            The article talks about negotiations breaking down over taxes and regulations. If they weren't getting special treatment, they'd get no better tax deal and no better rules than the computer shop down the street.

            • I think none of those activities are especially popular among libertarians. Some may be ok with tariffs, some may like immigration regulated. Virtually none of them want trade regulated, none of them want government dictating interest rates.

              Absolutely correct, none of those things are POPULAR amongst libertarians, but it's an extremely rare libertarian who would--for instance--say "no taxes, on anything, at all." It's a very rare libertarian who would say "no regulations, on anything, at all." There are many libertarians who don't believe in open-borders.

              But really, you're just avoiding the criticism I made of your posts. Governments perform myriad actions that affect the economy both directly and indirectly. It's frankly silly to say that gov

              • > you're just avoiding the criticism I made of your posts.
                Sorry. Not sure which point I failed to address. In general I'm interested in new ideas, facts, and understandings, but I tend to ignore strangers' opinions of my character, intelligence, or blog posts.

                > building roads meddles with the economy
                I don't think "meddle with" means "affect" or "touch." I was referring to government actions that attempt to control the economy or favor special interests. Building roads and infrastructure is a healt

                • Sorry. Not sure which point I failed to address. In general I'm interested in new ideas, facts, and understandings, but I tend to ignore strangers' opinions of my character, intelligence, or blog posts.

                  Ok, except I didn't say anything at all about your "character, intelligence, or blog posts." (unelss you're calling a post on slashdot a blog post). I just replied to what you posted. Why post if you don't want to discuss a topic? I don't get it.

                  I don't think "meddle with" means "affect" or "touch." I was referring to government actions that attempt to control the economy or favor special interests. Building roads and infrastructure is a healthy and proper facilitation of the economy. But government giving selective access to that infrastructure I would consider meddling.

                  Again, the very definition of government. Government controls access to all of the infrastructure it creates. Governments, for instance, control access to roads. If governments levy taxes, they're acting proper, if they relieve taxes, they're meddling? What's the di

      • by khallow (566160)

        What I think you're really getting at, is that Marx wrote about what we might today call "social dumping."

        The economists call it "comparative advantage".

    • 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

      • by khallow (566160)

        The US has the ability to enforce near-infinite jurisdiction, try using it on multinationals for once.

        First, a counter question, why isn't the US already doing that? The answer to that question explains why your entire post is utterly futile.

      • by jonbryce (703250)

        Only on American multinationals, which is probably one of the reasons why the likes of Seagate has moved its corporate domicile to Ireland.

    • While you make some accurate points, and I'm aware of the morale and other Foxconn issues, I don't think they qualify for this story about moving to Brazil. The complaints by Foxconn about Brazil are well founded. It is highly corrupt, and the taxes are abnormally high. Their workforce is indeed unskilled: a large portion of their population can read (that is, can pronounce the words), but is not able to understand what they are reading. The infrastructure (power, water, television) is paid for by the rich,
      • by aliquis (678370)

        Well, if you want a skilled workforce, working infrastructure, no corruption, people who can read and so on you're free to move to the civilized world.

        I've for instance read how people complain on taxes and try to suggest how bad and hard it is to be a company here in Sweden. But then on the other hand you can expect all those things. Lots of things which may not work that well in other countries will work here.

      • Their workforce is indeed unskilled: a large portion of their population can read (that is, can pronounce the words), but is not able to understand what they are reading

        . This is not true for every region of the country. Some regions have problems (mostly North), some not (mostly South). Foxconn is/was going to the last.

        The infrastructure (power, water, television) is paid for by the rich, and literally stolen by the bandits and given away or sold for very little to large populations.

        Bullshit.

    • by ShakaUVM (157947)

      Sometimes government regulations are a good thing, and sometimes they're a bad thing. I'm not a libertarian purist that thinks all regulation is evil - I think there simply needs to be a balance struck at the right point. I don't think it's unreasonable to require smoke detectors in homes (the total cost of smoke detectors is a tiny fraction of the cost of a house), but I would be opposed to mandating sprinkler systems in detached homes. Balance, common sense, all that.

      I've seen regulations put the companie

      • You say both of those:

        "I don't think it's unreasonable to require smoke detectors in homes (the total cost of smoke detectors is a tiny fraction of the cost of a house)"

        "I've seen regulations put the companies of two of my friends entirely out of business - one was due to a conflict between state and federal laws that made it impossible for his company to pass a safety inspection with both the FDA and the state regulatory board."

        Yet, you fail to notice that the most reasonable piece of regulation (like yo

    • by Rayonic (462789)

      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.

      Perhaps a few thousand jobs are worth more than whatever corporate taxes they would have collected? I don't know Marx's stance on jobs, but I've heard they're beneficial to an economy.

      Plus, some countries even tax the income from jobs. Strange but true!

      • Yeah, people are simply unable to work by themselves. They must pay taxes, so that the government gives the money to big corporations to invest and command those taxpayers to work. Really, if we didn't just give our money to big corporations, they wouldn't command us to work, and we'd simply have no salary at all.

    • by khallow (566160)

      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.

      And so what? Marx was a loon. The thing you don't get is that this a natural and healthy limit on government. If governments could compel multinational organizations in the ways you desire, then they'd be able to do far worse to their own citizens, who don't have the resources of a multinational organization.

      I consider the current global situation where power is diffuse and spread not just through more than a hundred sovereign countries, but also thousands of multinational entities, to be pretty healthy

  • by Anonymous Coward

    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 c

    • by morcego (260031)

      You make 3 points on your post. Lemme address them one at a time.

      #1 Not enough skilled labor

      IBM, Ericsson, Motorola and others would disagree with you. However, there is a different between "not enough skilled labor" and "not enough unemployed skilled labor". If you mean the later, then you are write, but you should have expressed yourself better.

      #2 Price on imported parts

      Do your homework. There is the Manaus Free Trade Zone. There is where most of the companies that need to import parts put their factories

      • However, there is a different between "not enough skilled labor" and "not enough unemployed skilled labor". If you mean the later, then you are write, but you should have expressed yourself better.

        I think he expressed himself perfectly well. If all the skilled labor is already employed, then there is not enough for any more businesses to move down there.

        • by morcego (260031)

          No. If all skilled labor is already employed, then there is not enough for any more business THAT WANT TO PAY PEANUTS to move down here. If they offer competitive salaries, they will get all the employees they need.

  • Panama or Costa Rica would be much better.

    • by drinkypoo (153816)

      All the uplands in Panama are heavily volcanic and you must assume they will be again, especially in this period of increased volcanism. One of the nicest towns is called Caldera, and for good reason. All the uplands in Costa Rica are either mushy, inaccessible, inhabited by some of the few remaining natives, or all three. Both are very crappy places to build something requiring massive infrastructure. The lowlands of Panama are known for fire and flood. Costa Rica, mostly just flood, because they are signi

  • 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.
  • I called this shot 4 days ago, here on Slashdot ...

    http://slashdot.org/comments.pl?sid=2446794&cid=37517716 [slashdot.org]

    Seriously, did anyone really believe this ? Look at the source. These guys (Mercadante et al) are 10x worse than your usual politician.

  • 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.

  • 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
  • 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.

  • 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 cust

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