Eike Batista

By Luisa Frey
The collapse of Eike Batista’s business empire has dominated the headlines about Brazil in recent weeks. With good reason. The brash entrepreneur’s rise and fall has become a metaphor for the end of the country’s economic boom.

After growing 7.5 per cent in 2010, Brazil’s economy expanded by a paltry 2.7 per cent in 2011 and sputtered to only 0.9 per cent last year. This year it is forecast to grow by 2.5 per cent. Meanwhile, inflation is stubbornly high at 5.84 per cent in October (on a yearly basis) – well above the official target of 4.5 per cent. To keep expanding, the country will need to boost its productivity by eliminating growth bottlenecks, improving infrastructure and encouraging investment.

Here are some of the best articles from the FT and elsewhere about the end of the “Samba economy”.

 

♦ Eike Batista built an empire and became Brazil’s richest man with the OGX oil company. It now stands on the verge of bankruptcy, however, after it turned out the oil fields meant to produce more than half of Brazil’s current national production were duds.
♦ Raghuram Rajan has his work cut out for him as the new head of the Reserve Bank of India, with the rupee at fresh lows and the slowdown of quantitative easing on the horizon. Rajan, who warned about the crisis , is expected to take a tough stance on moral hazard.
♦ In an analysis of how Egypt’s rocky present could forecast Turkey’s future if the AKP does not distance itself from Erdogan’s brutal crackdown and drive for Islamisation, Timur Kuran argues that political Islam must gain power legitimately through the creation of democratic systems.
♦ “Once you spend more than $100m on a movie, you have to save the world,” Hollywood blockbuster writer Damon Lindelof tells New York Magazine in this profile the of the U.S. film industry.
♦ A pension crisis is drawing nearer in Chicago, as the retired teachers’ pension fund stands at risk of collapse and in 2015 state law will require it to pay $1bn more a year into city pension funds to make up for years of underpayments.