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When he ran in the 2002election, Lula said Brazil needed to create 10 million jobs. The phrase was twisted and became a laughingstock among political opponents, who considered creating so many jobs to be impossible or absurd.
Government policies, however, did much more than that: by the end of Lula’s terms in 2010, over 15 million jobs in Brazil had been created. After three years in office, Dilma’s administration had added another 4.5 million. And the North, Northeast and Center-West are setting consecutive job creation records. The result is that the share of these regions in the stock of formal jobs in Brazil is growing.
And the Bolsa Família, which for years was regarded by the opposition as a sop for the poor and a reason for discouraging workers from getting a real job, actually helps create jobs. In the Northeast, where 51.1% of the program’s beneficiaries are located, from 2004 to 2012, 807,000 jobs were created and maintained thanks to the increased power of consumption of the beneficiary families. This is yet another example of the powerful virtuous circle of social policies implemented by Lula and Dilma and their regional impact.
Raise and ensure real increases of the minimum wage directly benefited the North and Northeast regions of the country, precisely those with the highest percentage of workers whose income is at that level. In the Northeast, for example, where almost half of Brazilian workers and retirees who receive a minimum wage live, according to PNAD 2012, the increase in average income of the population was 5.4%, well over the national average, attracting new private investment and giving the regional economy new impetus.
Retailers feel the positive effects more, with large groups opening outlets in medium-sized cities in the North, Northeast and Center-West and multiplying their chain stores in capital cities and metropolitan regions. At the end of 2013, the payment default rate of the sector was at the lowest levels recorded in this century, falling from 5.7% to 4.5% in the previous year, according to a study conducted by the Credit Protection Service (SPC Brasil) and the National Confederation Retail Store Managers Confederation (CNDL).
High interest rates, red tape and a high level of demand hindered both access to credit, where money was only available to those who already had money — that is, not to those that needed it. In the Lula and Dilma governments, it became easier for small consumers, micro- and small entrepreneurs to obtain loans from public banks, which also helped change lives both inside and on the outskirts of major cities in the Amazon and in Northeast regions.
The strategy of facilitating access to credit helped multiply commercial stores, increase production of food produced on family farms and expand services that were previously almost non-existent in small cities.
And credit is reaching the most humble populations in the Northeast. Bolsa Família recipients represent 45% and 65% of the clients of Banco do Nordeste’s (BNB) urban and rural microcredit programs, respectively, known as Crediamigo and Agroamigo. Adding together both programs, the number of micro-entrepreneurs who are also beneficiaries of Bolsa Família exceeds 1.1 million people.
(Learn more in the Microeconomy section)
Here are some success stories of Banco do Nordeste’s Crediamigo and Agroamigo programs to see how micro-lending is changing the lives of families in hinterland towns
The concentration of wealth, industries and investments in the Southeast for decades led to internal migration, which emptied lands in the Northeast and overcrowded outlying areas in the Rio-São Paulo metropolitan areas. Because of Lula’s and Dilma’s growth policies, now even in a time of drought Northeasterners no longer need to seek a better way of life away from home.
The National Program for Strengthening Family Agriculture (Pronaf) gained new dimensions after its budget grew from R$ 2.2 billion in 2002 to R$ 21 billion in 2013. Because 30% of school lunches must now be supplied by family farmers, a guaranteed market exists for what is produced on small farms. Integrated policies for infrastructure and production support in 123 Citizenship Territories (84 of them in the North and Northeast) are giving rise to models of sustainable development in rural areas with high poverty rates.
(Learn more in the Family Agriculture and Agrarian Reform sections)
And when the drought became severe, Dilma did not repeat that she would "fight it" - as if that were possible – rather she earmarked R$ 7 billion to foster agriculture technologies that could work in the semi-arid and drought regions, through the Semi-Arid Crop Plan. To mitigate the immediate effects of the drought, the government offers a monthly Drought Stipend of R$ 80.00 to 1.3 million farmers who temporarily are unable to produce.
Furthermore, the biggest Water Delivery operation in history was mounted, with the support of the Army, along with the hiring 6,400 water trucks. In addition, more than 600,000 tons of corn were offered at subsidized prices and 300,000 thousand cisterns were installed. Altogether, Lula and Dilma built about 1 million cistern for human water consumption.
Resources to support agriculture and livestock added with the income transfer of the Bolsa Família (51.1% of the 50 million beneficiaries of the program are in the Northeast) explain a historical change at the moment when the region is experiencing its worst drought in decades (compared to the previous worst ones of the 1950s and 1970s) and, for the first time, there is no mass migration to the Southeast. Neither is there looting of grocery stores or street markets nor invasions of cities, so common in the past. It is true that drought is an important climate problem, but its social impact has now been reduced.
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More income and more formal jobs led to higher growth in consumption in the North and Northeast: another almost immediate consequence was better quality of life prospects and a desire for a better future for the next generations. Between 2001 and 2012, enrollment in higher education has almost doubled in Brazil. In the North and Northeast, growth was even higher: 285.15% and 211.70%, respectively, considering census variations, including enrollment in public and private schools. With this growth, the Northeast region is now in second place in higher education enrollments (19% in 2012), having surpassed the South in 2008.
Attentive to the needs of this segment of the population, the Lula and Dilma governments have made the investments that were needed: of the 208 vocational technical schools built from 2011 until 2014 or under construction, 77 are in the Northeast. The four federal universities created in 2013 by the Dilma government lie in the north and northeast of the country: two in Bahia, one in Ceará and one in Pará.
(Learn more in Education)