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July 1998, Volume 5, Number 7

South America: Brazil, Mercosur

Brazilian President Fernando Henrique Cardoso was reportedly considering an amnesty for the estimated 300,000 illegal aliens in Brazil in June 1998. Most of the illegal foreigners live in Rio de Janeiro and Sao Paulo, and most are from South Korea, China, Bolivia, Angola, Mozambique, Liberia and Nigeria. Under the proposed amnesty, they would be allowed to open bank accounts and send their children to public schools.

In June, a statue was unveiled in Santos, Brazil to commemorate the migration of 250,000 Japanese to Brazil. The first group of 781 Japanese arrived on June 18, 1908 at the port of Santos near Sao Paulo to work on coffee plantations. There are now about 1.5 million Japanese-Brazilians; 85 percent live in Sao Paulo. In the late 1980s, Japanese-Brazilians began emigrating to Japan--there are an estimated 250,000 Brazilians of Japanese descent in Japan.

Mercosur. The southern cone common market (Mercosur) has increased trade between Argentina, Brazil, Paraguay and Uruguay to $17 billion in 1996 from $4 billion in 1990; Mercosur went into effect in 1991. Mercosur countries have largely eliminated tariffs between themselves and imposed a roughly 20 percent tariff on goods entering the region. Bolivia and Chile have become associate members of Mercosur.

Mercosur aims for eventual freedom of movement. However, there are disputes over the treatment of "unregistered" workers and jobs--jobs on which employers do not pay pension and other payroll taxes, thus reducing labor costs by 20 to 50 percent. For example, only two-thirds of Argentine workers in 1991 were enrolled in the mandatory pension system and almost 40 percent of the 40 million workers in Brazil do not have the official labor card, signifying enrollment in work-related pension and other programs.

There have been problems with efforts to coordinate immigration policies. In 1996, the four Southern Cone countries decided to unify immigration procedures, but the new immigration card took one year to be established by Argentina, Uruguay and Paraguay despite the official recommendation that the maximum delay should not exceed six months. It took Brazil even longer to adopt the new immigration card.

There are complaints that customs infrastructure between Brazil and Argentina has not been updated, despite a 400 percent increase in the number of trucks crossing the border since the start of Mercosur.

Brazil, with 164 million people, the world's fifth largest country, is the dominant Mercosur economy. About 60 million people between ages 16 and 60 including about 13 million employed in the public sector are considered part of the "official" work force. Under existing law, once those public employees retire, they are entitled to their full salaries for the rest of their lives. Women can retire after 25 years of work and men after 30 years, regardless of age.

Brazil has attracted foreign investment, but economic changes have not reduced income inequality: the richest 20 percent of the Brazilian population gets about 60 percent of the national income, compared with 42 percent in the US. Some 40 percent of Brazilians are poor and 25 percent have annual incomes under $365.

During the 1970s and 1980s, Brazil experienced rural-urban migration. Layoffs in the mid-1990s are pushing some of the urban unemployed back to rural areas, where some poor Brazilians have occupied land. The Landless Rural Workers Movement, known as the MST, has led 280 occupations to take over 1.4 million acres. Under Brazilian law, the government can give occupants of "unproductive land" title to the land.

In mid-May, 1997, 500 farm workers accompanied by sheep, pigs, turkeys and billy goats occupied the office of Brazil's planning minister to demand $900 million in family farming credits.

Argentina. The government of Argentina plans to have residents spend $400 to $600 million over six years to replace 35 million Argentinean passports and to computerize the national registry of citizens. The winning private bidder is supposed to install computer terminals at 200 border crossings, reissue Argentine ID booklets and maintain a central data registry; it will charge fees to cover its costs.

On February 16, officials of Argentina and Bolivia signed an immigration agreement which will allow 700,000 Bolivians living without the proper documentation in Argentina to be granted residence.

To reduce unemployment, the Argentinean government in October 1996 proposed labor law reforms, including an end to industry-wide bargaining and a reduction in severance payments. About 70 percent of Argentinean workers are union members. Unions collect $60 million monthly in dues and $200 million to administer health plans for workers.

Argentina's GDP per capita was about $8,900 in 1997 and the economy is expected to grow by seven percent.

Chile, with an economic growth rate of over seven percent and an unemployment rate of seven percent, is attracting immigrants from neighboring Argentina and Peru. There are an estimated 30,000 illegal foreigners in a country of 13.5 million.

Bolivia. Finding sufficient seasonal workers is a problem in many countries' agricultural sector. In mid-1997 workers in Bolivia were hired to help with potato, garlic, and carrot harvests on "large farms" over three acres for a wage of $3 a day, with lunch (less for soldiers working off-duty). The wage is the same regardless of sex; most of the negotiations involve inducements such as alcohol and coca leaves, and trust that the employer will actually pay the agreed wage. Hired labor markets are very local, and based on personal relations and reputations.

Many small Bolivian farmers (less than three acres) migrate seasonally to Argentina to work on larger farms there, and leave their Bolivian farms to their children or let them lie fallow.

Colombia/Venezuela. Colombia in March 1997 imposed visa requirements on 74 countries, including Cuba and China. The government estimates that 7,000 Cubans entered Colombia without visas, and 300 of the Cubans married Colombians to obtain citizenship.

As many as three million of Venezuela's 22 million citizens are recent immigrants, including Colombians, Arabs, Chinese, Peruvians, Ecuadorians, Guyanese, Dominicans, Haitians and Cubans. Venezuela has been plagued by stolen passports and false immigration documents; Venezuela is considering a plan to have Siemens manufacture tamper-resistant ID cards.

In April 1997, Venezuela announced plans to issue identification cards to farm workers who cross the border from Colombia; about 90 percent of the laborers working on border farms and ranches in Venezuela are Colombians.

Colombia fined American Airlines $2,400 for allowing a South African to arrive in Colombia without a visa or money, the first time it levied penalties against an airline. Colombia is attempting to crack down on illegal immigrants who enter the country in order to obtain false documents.

"Brazil's Cardoso May Give Amnesty to Illegal Aliens, Paper Says," Bloomberg, June 19, 1998. "Brazilian president praises Japanese immigrants," Agence France Presse, June 21, 1998.