NEW YORK (MainStreet)Twenty years ago the Brazilian economy was in a free fall. Unemployment was catastrophically high. Currency was caught in a cycle of super-inflation, sometimes spiking over 1,000% per year, with prices changing every hour and money measured by the suitcase. Things got so bad that, in an act of desperation, the government even seized bank accounts nationwide in an attempt to get some control over the economy.
That was then.
Today the Brazilian Real is strong again, trading at just two to the dollar, and the country's GDP has become the eighth largest internationally. Sao Paulo has even been voted one of the most "economically powerful cities in the world," putting it in the company of places such as New York, Tokyo and London. Brazil's economy has made an incredible amount of progress, and, while there's still a long way to go, that's not an accident.
Among the many pieces to making Brazil work again, one of the most important has been the introduction of a strong system of financial education, as highlighted at the recent 2013 Financial Literacy Forum Series that MainStreet attended in Sao Paolo. Deciding that an economy is ultimately the sum of its parts, a combination of government, charity and corporate programs has grown across the country to ease people away from purely cash economics and teach them how to make sound financial decisions. Three years ago, in 2010, the government formalized this project with its National Strategy for Financial Education, a far more ambitious version of the U.S. commission on the same issue.
The explosion of Brazil's modern economy is nowhere more obvious than on the streets of Sao Paulo, where even the fruit stands and local esfiha vendors take credit cards. This success has brought its own set of problems, though. With the spread of physical infrastructure for banking and an electronic economy, it's become increasingly clear how often giving people access to something like a credit card without proper education can be even worse than never modernizing in the first place.