Sales of Brazilian-made firearms to the U.S. increased 187.5% while former President Luiz Inácio Lula da Silva was in office, compared to the same eight-year period that his predecessor, Fernando Henrique Cardoso, was in power.

The U.S. purchased nearly 7.9 million, or 80%, of the 9.9 million exported Brazilian firearms in the past forty years, Folha de S.Paulo newspaper reports.

Gun by Brazilian company Taurus have proved popular in the US. Photo by Flickr/castironskillet.

Gun by Brazilian company Taurus have proved popular in the U.S. Photo by Flickr/castironskillet.

The total of 7,873,321 firearms sold to the U.S. between 1971 and 2011 dwarfs sales to the next biggest importers of Brazilian guns: Argentina (215,216), Paraguay (154,711), Yemen (112,272) and Germany (109,273).

Of the 9.9 million firearms sold, 42.2% were revolvers, 23.8% were shotguns (espingardas), 17.8% were pistols, with the rest a mixture of different types of rifles, including semi-automatic weapons.

Figures from the Brazilian Army Command, released after a request by the São Paulo newspaper under the Freedom of Information Act, showed that 59% of this total, 4.6 million units, was exported between 2003 and 2010, enough to arm every person in the state of Louisiana today.

In 2011, the final year included in the Army report, Brazil exported more firearms to the U.S. than Austria and Germany combined, the second and third biggest firearms exporters to the US, after Brazil.

Brazilian arms manufacturer Taurus, headquartered in Porto Alegre, Rio Grande do Sul, has been responsible for over half of Brazilian arms exports to the U.S. since 1971, and around half of the products this company makes are sold to American buyers.

The company, founded in 1941 and arriving in the U.S. in 1968, is now one of the world’s biggest manufacturers of small firearms and the fourth biggest in the States. Taurus USA was created in 1984 and, along with its factory in Miami, the company reportedly arms police forces in over 70 countries.

In Brazil, according to Taurus, the company’s revenues were R$701 million last year, a 13.4% increase.

Read the full article on The Rio Times website

TV in electronics shop in Curitiba, photo by Ben Tavener

A TV for R$103? Take a closer look…

If you’ve lived in Brazil for a while, you’ll know the scene: you walk into a shop and an unbelievably cheap price leaps out at you. R$100 – $50 or so – for a brand new laptop. Wow!

But what you’ve failed to see is the little “15x” next to it. That computer is actually R$1500, possibly plus a down payment.

Parcelamento – paying by instalment – is Brazil’s preferred way of making expensive purchases, and certainly sellers’ favourite way of convincing people they can afford them.

You find it everywhere: from pricier electrical goods – laptops, cameras, TVs – to flights.

You can either pay in one lump – à vista – or you can divide the cost into more manageable chunks or parcelas, sometimes available at no extra cost. But customers often end up paying more for the instalment option, which usually involves five to ten monthly payments.

For example – the TV pictured above is R$1,090 if paid in one go, but R$1,545 if paid in 15 monthly instalments. But what do you see? R$103.00! Wooo!

More temptingly, you can even buy a car this way, and they’ll give you up to 60 instalments – five years – to pay it off.

No wonder there are practically more cars than people in Brazil these days – particularly after the government dropped the IPI tax on them and made getting a loan ever cheaper (something I’ll touch on again later).

Now a study by Ibre-FGV – Instituto Brasileiro de Economia – says some 58.2% of Brazilians are using their monthly salary to pay off “instalment debt”, although the survey also showed most debts were short-term: 78.4% had repayment plans of six months or less, and only 10.1% had taken out plans for twelve months or more.

The report concludes that most people are coping, but there are a small number of people who are diverting over half of their income to this type of debt – and some who are in over their necks, whose outgoings exceeds their earnings.

Unsurprisingly, it’s the more vulnerable families with less disposable income that opt for this method most often.

Some Brazilian friends of mine explained why they take advantage of paying in instalments. They say it’s because it’s the only real way of getting their hands on products quickly that otherwise they wouldn’t have the ready funds available to buy outright.

“What about using a credit card?” you may ask.

Unfortunately, credit is expensive in Brazil. In a recent survey by ProTeste, credit cards in Brazil were recently found to be typically in the region of over 320% APR – unthinkable to those in the UK or America where our cards are usually subjected to 15-25% APR.

And for a long time – particularly over less stable economic times since the global downturn hit in 2008 – the man with his hands on Brazil’s pursestrings, Finance minister Guido Mantega, has done everything he can to encourage Brazilians to spend.

He has rejigged cars, gadgets and other “must-haves” into cheaper tax brackets, made bank loans cheaper, and Brazil’s key interest rate, the Selic, is now at a historic low of 8.0%.

This, the government believed, was the best way to see Brazil through those rocky waters: and it paid off. Brazil came through almost unscathed.

However, as UFPR economist Professor Luiz Esteves told me, this is now turning into a mistake, and is something that cannot hold indefinitely.