its lines except the Estrada de Ferro Central do Brazil, which is
retained for sentimental reasons. This great railway runs from the
city of Rio de Janeiro westward to the city of Sao Paulo and northward
into the interior of Minas Geraes, with a total length at the
beginning of 1905 of 1002 m., and an extension of about 104 m. to
Pirapora, on the Sao Francisco river. It was formerly known as the "E.
de F. Dom Pedro II.," in honour of the sovereign who encouraged its
construction. The main line has a gauge of 63 in. (1.60 m.) and
affords an outlet for a number of inland metre-gauge lines. The first
two sections of this great railway, which carry it across the coast
range, were opened to traffic in 1858 and 1864. The series of trunk
lines terminating at the port of Santos are owned by private companies
and are formed by the Sao Paulo, Paulista and Mogyana lines, the first
owned by an English company, and the other two by Brazilian companies.
The Mogyana carries the system entirely across the state of Sao Paulo
into the western districts of Minas Geraes. The principal trunk lines
(the Sao Paulo and Paulista) have a broad gauge, while their
extensions and feeders have a narrow gauge. The comparatively short
lines extending inland from the ports of Sao Salvador (Bahia),
Pernambuco, Maceio, Victoria and Paranagua serve only a narrow zone
along the coast. To encourage the investment of private capital in the
construction of railways, the general railway law of 1853 authorized
the national government to grant guarantees of interest on the capital
invested. Under this law companies were organized in England for
building the Sao Paulo railway, and the lines running from Bahia and
Pernambuco toward the Sao Francisco river. Political considerations
also led to the construction of similar lines in the states of Rio
Grande do Norte, Parahyba, Alagoas, Sergipe, Espirito Santo, Parana,
Santa Catharina and Rio Grande do Sul. The result was that the
national treasury became burdened with a heavy annual interest charge,
payable abroad in gold, which did not tend to diminish, and had a long
period to run before the expiration of the contracts. The government
finally determined to take over these guaranteed lines from the
foreign companies owning them, and a statement issued in October 1902
showed that 1335 m. had been acquired at a cost of L14,605,000 in
bonds, the interest on which is L584,200 a year against an aggregate
of L831,750 in interest guarantees which the government had been
paying. In addition to this economy it was calculated that the lines
could be leased for L132,000 a year. The loan finally issued in London
to cover the purchase of these railways aggregated L16,619,320. All
but three of these lines had been leased in 1905.
The use of tramways for the transportation of passengers in cities
dates from 1868, when the first section of the Botanical Garden line
of Rio de Janeiro was opened to traffic. The line was completed with
its surplus earnings and continued under the control of the American
company which built it until 1882, when it was sold to a Brazilian
company. Subsequently the tramways of the city have been mostly
concentrated in the hands of a single Canadian company. All the large
cities of Brazil are liberally provided with tramways, those of the
city of Sao Paulo, where electric traction is used, being noticeably
good. The substitution of electricity for animal traction was begun in
Sao Salvador in 1906. Mules are universally employed for animal
traction, and narrow gauge lines with single-mule trams are generally
used where the traffic is light.
Brazil is lamentably deficient in steamship communication considering
its importance in a country where the centres of population are
separated by such distances of coasts and river. Previous to the
creation of the republic, the coastwise service was performed by two
national companies (now united), and partially by foreign lines
calling at two or more ports. A considerable number of foreign sailing
vessels also carried on an important coasting trade. The coastwise
service centres at Rio de Janeiro, from which port the Lloyd
Brazileiro sends steamers regularly south to Montevideo, and north to
Para and Manaos, calling at the more important intermediate ports.
From Montevideo river steamers are sent up the Parana and Paraguay
rivers to Corumba and Cuyaba, in the state of Matto Grosso. The
company receives a heavy subsidy from the national government. Parts
of this coastwise traffic are covered by other companies, two of which
receive subsidies. There were also six lines of river steamers
receiving subsidies from the national government in 1904, and the
aggregate paid to these and the coastwise lines was 2,830,061 milreis.
The largest of the river lines is the Amazon Steam Navigation Co. (an
English corporation), whose service covers the main river and several
of its principal tributaries. Two subsidized companies maintain
services on the Sao Francisco river--one below the Paulo Affonso
falls, and the other above, the latter covering 854 m. of navigable
channel between Joazeiro and Pirapora. Besides these there are other
companies engaged in the coasting and river traffic, either with
subsidies from the state governments, as feeders for railway lines, or
as private unsubsidized undertakings.
The telegraph lines, which date from 1852, are owned and operated by
the national government, with the exception of the lines constructed
by private railway companies, and the cable lines of the Amazon and
the coast. The government lines extend from Para to the Argentine and
Uruguayan frontiers, where they connect with the telegraph systems of
those republics, and from Rio de Janeiro westward across country, in
great part unsettled, to the capitals of Goyaz and Matto Grosso. At
Para connexion is made with the cable laid in the bed of the Amazon to
Manaos, which is owned and operated by a subsidized English company.
At Vizeu, Para, connexion is made with a French cable to the West
Indies and the United States, and at Pernambuco with two cable lines
to Europe. A coastwise cable runs from Para to Montevideo with double
cables between Pernambuco and Montevideo. There were in 1903 a total
of 15,150 m. of land lines, with 29,310 m. of wire and 1102 telegraph
offices. The government maintains reciprocal rates with most of the
private railway lines.
The Brazilian postal service is under the general supervision of the
minister of communications and public works, and is administered by a
director-general. Owing to the size of the country and the
sparsely-populated state of a large part of the interior, the
transportation of the mails is attended with much difficulty and
expense. Although the postal rates are high, the service is not
self-sustaining, the receipts for 1904 being 7,018,344 milreis,
against a total expenditure of 10,099,545 milreis. There were 2847
post offices (_agencias_), of which 2166 were of the 4th or lowest
grade. Brazil is a member of the Postal Union, and like Argentina
exacts higher nominal rates of postage upon outgoing mail than those
agreed upon to cover the depreciation in her own currency. The letter
rate was at first 200 reis (nearly 5-1/2 d.), but it has been
increased to 300 reis, which is equivalent to 8 d. at par and 4-1/2 d.
at 15 d. exchange. An inland parcel post was in operation long before
the overthrow of the monarchy, and a similar service with Portugal has
been successfully maintained for a number of years, notwithstanding
the difficulties interposed by customs regulations. National and
international money order systems are also in operation.
The constitution of Brazil provides that the coastwise trade shall be
carried on by national vessels, but this provision did not go into
effect until 1896. And even then, because of the insufficient number
of Brazilian vessels it was provided in the regulations that foreign
vessels could be enrolled in that trade by using the Brazilian flag
and employing a certain proportion of Brazilians on the crew. One of
the purposes of this restrictive provision was that of creating a
national merchant marine, but the disinclination of Brazilians for
maritime pursuits has been a serious obstacle to its realization. In
1901 the merchant navy included 228 steamers of 91,465 tons net, and
343 sailing vessels of 76,992 tons net. These vessels are all engaged
in the coasting and river trade of the country. Efforts have been
made, however, to engage in foreign trade, and subsidies were offered
for a passenger and freight service to the United States. On the 23rd
of February 1906 the government completed a new contract with the
Lloyd Brazileiro Company for its coastwise and river service, and
included clauses providing for a line to the United States. This
foreign service (monthly) began in August 1906.
Although the coast of Brazil shows a large number of bays and
tide-water river channels which are apparently suitable for commercial
ports, a close examination of them reduces the number of good ports to
less than a dozen. The others are either difficult of access, or are
rendered practically useless by dangerous reefs, sand bars and shoals.
Important improvements have been undertaken in some of these ports.
Those at Santos and Manaos, for example, have produced good results.
In many cases, as at Rio de Janeiro, Santos and Manaos, the cost and
maintenance of the new port-works are met by an additional tax on
merchandise, though the immediate expenditures are met by advances
from the national treasury, and at Rio de Janeiro by a foreign loan.
_Commerce._--The imports, exports and domestic trade of Brazil are
by reason of their magnitude and peculiar character the most important
in South America, though the _per capita_ aggregate is less than that
of Argentina. Although an agricultural country, Brazil does not
produce all its own bread and meat, and the imports of wheat, wheat
flour, rice, fish, jerked beef and preserved meats, lard, butter,
beans, potatoes, packed fruits and vegetables, Indian corn and other
food-stuffs, are surprisingly large. Since the creation of the
republic, extreme protective measures have caused the creation of a
large number of cotton factories and other manufactures, but these are
able to supply only a part of the consumption, and the importation of
cotton and woollen fabrics, silks, ready-made clothing, boots and
shoes, &c., is large. Modern industrial development in some of the
states has greatly increased the importation of machinery, electric
supplies, materials for construction, coal, &c. Kerosene oil also
figures among the principal imports, and beef cattle are imported for
consumption by some cities. The exports cover a wide range of
agricultural, pastoral and natural productions, including coffee,
rubber, sugar, cotton, cocoa, Brazil nuts, _mate_ (Paraguay tea),
hides, skins, fruits, gold, diamonds, manganese ore, cabinet woods and
medicinal leaves, roots and resins. Coffee and rubber, however,
represent from 80 to 90% of the official valuation of all exports.
High import duties are imposed by the national government and export
duties by the states. The exchange of domestic products between the
states is greatly restricted through lack of cheap transportation
facilities, and by the suicidal imposition of import and export duties
by the states, either for revenue or for the protection of home
industries.
According to a summary for the six years 1901 to 1906, derived from
official sources and published in the annual _Retrospecto_ of the
_Jornal do Commercio_, of Rio de Janeiro, the values of the imports
and exports for those years (exclusive of coin), reduced to pounds
sterling at the average rate of exchange (or value of one milreis) for
each year, were as follows:--
+------+-----------+------------+-------------+
| | Average | | |
| Year.| Value of | Imports in | Exports in |
| |the Milreis|Pounds Ster.| Pounds Ster.|
| | in Pence. | | |
+------+-----------+------------+-------------+
| | | L | L |
| 1901 | 11.33 | 21,377,270 | 40,621,993 |
| 1902 | 11.93 | 23,279,418 | 36,437,456 |
| 1903 | 11.99 | 24,207,811 | 36,883,175 |
| 1904 | 12.22 | 25,915,423 | 39,430,136 |
| 1905 | 15.94 | 29,830,050 | 44,643,113 |
| 1906 | 16.17 | 33,204,041 | 53,059,480 |
+------+-----------+------------+-------------+
Nearly 76-1/2% of the exports of 1906 were of coffee and rubber, the
official valuations of these being: coffee 245,474,525 milreis gold
(L27,615,884), and rubber (including manicoba and mangabeira),
124,941,433 milreis gold (L14,055,911).
Brazil is essentially an agricultural country. No other country has
been able to equal Brazil in the production of coffee, and under
better labour conditions the country might compete with the foremost
in the production of cane sugar, cotton and tobacco. Besides these it
might easily excel in producing many of the tropical fruits for which
there is a commercial demand. During the colonial period sugar cane
was cultivated from Parahyba S. to the vicinity of Santos, and sugar
was the principal export of the colony. Before the middle of the 19th
century coffee became one of the leading exports, and its cultivation
in the states of Sao Paulo, Rio de Janeiro and Minas Geraes has been
so increased since that time that it represents over four-fifths in
value of the total export of agricultural produce. The principal
sugar-producing states are Alagoas, Sergipe, Pernambuco, Bahia and Rio
de Janeiro, and the production is between 200,000 and 300,000 tons,
the greater part of which is consumed in the country. Cotton has been
widely cultivated since early colonial days, principally in the
northern Atlantic states. Tobacco is also widely cultivated, and the
product of some states, such as Bahia, Minas Geraes and Goyaz, has a
high local reputation for its excellence. Cacau (cocoa) is cultivated
extensively in the Amazon Valley and along the coast as far south as
southern Bahia, and forms one of the leading exports. In 1906 Sao
Paulo offered premiums for its cultivation in the state. Rice has been
cultivated in places, but without much success, although the quality
produced compared favourably with the imported article. Indian corn
grows luxuriantly everywhere, but it does not mature well in the humid
regions of the Amazon region and the coast. The product of the
elevated inland regions is good, but the costs of transportation and
the small profits afforded have prevented its extensive cultivation,
and it is imported from the La Plata republics for consumption along
the coast. Much has been said in regard to the production of wheat,
and efforts have been made in various places to promote its
cultivation. It was once cultivated in Rio Grande do Sul with some
success, and it has been grown in Minas Geraes and Sao Paulo, but in
no case have the returns been sufficient to give it a permanent
standing among the productions of the country. The great majority of
the people are unused to wheaten bread, using the coarse flour of the
mandioca root instead, consequently the demand for wheat and flour is
confined to the large cities, which can obtain them from Argentina
more cheaply than they can be produced in the country. One of the most
common and important productions of Brazil is _mandioca_ (_Manihot_),
of which there are two well-known species, _M. utilissima_ and _M.
aipi_. The first named, which is poisonous in its native state, is the
_cassava_ of Spanish America. From it is made _farinha de mandioca_,
which is the bread of the common people of Brazil, and tapioca. The
poison is extracted by soaking the bruised or grated roots in water,
after which the coarse flour is roasted. Mandioca was cultivated by
the natives before the discovery of America, and the wide area over
which it has been distributed warrants the conclusion that the
discovery of its value as a food and the means of separating its
poisonous properties must have occurred at a very remote period. The
peanut, or ground-nut (_Arachis hypogaea_), is another
widely-cultivated plant, dating from pre-Columbian times. Very little
attention has thus far been given to the cultivation of fruit for
exportation, the exceptions being bananas for the Argentine and
Uruguayan markets, and oranges and pineapples for European markets.
The coast region from Ceara to Rio de Janeiro is adapted to the
cultivation of a great variety of fruits of a superior quality. Ceara,
Bahia, and Rio de Janeiro are celebrated for their oranges, and
Pernambuco for its delicious pineapples. Tangerines, lemons, limes,
grapes, guavas, figs, cashews or cajus (_Anacardium occidentale_),
mangabas (_Hancornia speciosa_), joboticabas (_Eugenia cauliflora_ and
_E. jaboticaba_, Mart.), cocoa-nuts, mangos, _fruitas de conde_
(_Anona squamosa_), plantains, &c. are produced in abundance and with
little labour. In some parts of southern Brazil the fruits and
vegetables of the temperate zone do well, but within the tropics they
thrive well only at a considerable elevation above sea-level. Apples,
peaches, quinces, raspberries, strawberries, &c., are produced under
such conditions, but the flavour of their kind grown in colder
climates is usually wanting. The vegetable productions are less
numerous, but they include sweet potatoes, cabbages, cauliflower,
lettuce, beans, peas, onions, garlic, tomatoes, okra, radishes,
cucumbers, couve, chuchu (_Sechium edule_), and aipim (_Manihot
aipi_). The white potato, known as "batata inglez" (English potato),
is grown in elevated localities, but it deteriorates so greatly after
the first planting that fresh imported seed is necessary every second
or third year.
The pastoral industries, which date from early colonial times, have
suffered many vicissitudes, and their development has failed to keep
pace with the country's growth in population. Horses are used to some
extent for riding, but very little for carriage and draught purposes,
consequently there has been no great incentive for their breeding.
They are largely used and raised in Rio Grande do Sul, but in the
warmer regions of the north only to a limited extent. The hardier
mules are generally employed for draught, carriage, and saddle
purposes in every part of the country, and their breeding is a
lucrative industry in the southern states. Cattle-raising is the
principal industry in Rio Grande do Sul, and receives considerable
attention in Minas Geraes, Matto Grosso, Santa Catharina, Parana,
Piauhy and Rio Grande do Norte. It was estimated that there were
30,000,000 head of cattle in the republic in 1904, but the estimate
was unquestionably too large. A very large part of the jerked beef
consumed in Brazil is imported from Argentina and Uruguay, and some
beef cattle also are imported. These importations at Rio de Janeiro in
1906 were 12,464,170 kilograms of jerked beef and 12,575 head of
cattle. In the Rio Branco region of Amazonas and in Piauhy, where the
national government has long been the owner of extensive cattle
ranges, the industry is in a state of decadence. This is partly due to
such pests as the vampire bat and bush ticks (_carrapatos_), and
partly to the unprogressiveness of the cattlemen. Cattle-raising was
once a flourishing industry on the island of Marajo, at the mouth of
the Amazon, and it is followed to some extent at Alemquer and other
points along the Amazon, but the cattle are small, and commonly in bad
condition. In southern Bahia the industry has been nearly extinguished
through increasing aridity and droughts, but in the state of Rio de
Janeiro the planters are increasing their herds. Minas Geraes produces
cheese, butter and milk, as well as beef cattle for neighbouring
cities. Matto Grosso classifies cattle-raising as a principal
industry, but under present conditions the accessible markets are too
small for any large development. In Rio Grande do Sul, where it has
attained its greatest development, about 400,000 beeves are
slaughtered annually for the manufacture of jerked beef (_xarque_),
beef extract, &c. Little attention has been given to sheep in Brazil
except in the southern states, and even there the flocks are small.
They were to be found in Ceara and Piauhy in colonial times, and small
flocks are still to be seen in the latter state, but no use is made of
their wool, and the market for mutton is extremely limited because of
popular prejudices. Woollen manufactures have been established in Rio
de Janeiro, Sao Paulo and Rio Grande do Sul. The exportation of wool
amounted to 1,130,160 lb. in 1906. Goats have been found highly
profitable in many of the middle Atlantic states, where the long dry
seasons render the campos unsuitable for cattle pasturage. The export
of goat skins from these states is large. Swine do well in all parts
of the country, especially in Minas Geraes, Sao Paulo, Rio de Janeiro,
Parana and Rio Grande do Sul, and domestic pork and lard are slowly
supplanting the heavily-taxed foreign products.
Although the coast and river fisheries of Brazil are numerous and
valuable, cured fish is one of the staple imports, and foreign
products are to be found even along the Amazon. In the Amazon valley
fish is a principal article of food, and large quantities of
_pirarucu_ (_Sudis gigas_) are caught during the season of low water
and prepared for storage or market by drying in the sun. This and the
collection of turtle eggs for their oil, or butter, are chiefly Indian
industries, and contribute largely to the support of the native
population of that region. Along the coast the best known fisheries
are among the Abrolhos islands and in the shallow waters of Espirito
Santo, where the garoupa, pargo and vermelho (species of _Serranus_)
abound in great numbers.
The extractive or forest industries of Brazil were among the first to
engage the attention of Europeans, and have always been considered a
principal source of colonial and national wealth. The varied uses of
india-rubber in modern times, however, have given them a greatly
enhanced importance and value. Of the exports of 1905, 36% were of
this class, while those of the pastoral and mining industries combined
were not quite 6-1/2%. In 1906 the percentages were 31 and 6.67,
showing a considerable loss for the former and a slight gain for the
latter. The principal products of this class are india-rubber, mate,
Brazil nuts, vegetable wax, palm fibre, cabinet woods, and medicinal
leaves, roots, resins, &c. Before the discovery of the cheaper aniline
colours, dye-woods were among the most valuable products of the
country; in fact, Brazil derives her name from that of a dye-wood
(Brazil-wood--_Caesalpinia echinata_), known as _bresill, brasilly,
bresilji, braxilis_, or _brasile_ long before the discovery of America
(see Humboldt's _Geographic du nouveau continent_, tom. ii. p. 214),
which for many generations was the most highly prized of her natural
productions. Of the total exports of this group (1905) very nearly 90%
was of india-rubber, which percentage was reduced to 85 in the
following year. The exportation for 1906 was 69,761,123 lb. of Hevea,
5,871,968 lb. of manicoba, and 1,440,131 lb. of mangabeira rubber, the
whole valued at 124,941,433 milreis gold. The dried leaves and smaller
twigs of mate (Paraguayan tea--_Ilex paraguayensis_) are exported to
the southern Spanish American republics, where (as in Rio Grande do
Sul) the beverage is exceedingly popular. The export in 1906 amounted
to 127,417,950 lb., officially valued at 16,502,881 milreis gold. The
collection of Brazil nuts along the Amazon and its tributaries is
essentially a poor man's industry, requiring no other plant than a
boat. The harvest comes in January and February, in the rainy season,
and the nut-gatherers often come one or two hundred miles in their
boats to the best forests. The nuts are the fruit of the _Bertholletia
excelsa_, one of the largest trees of the Amazon forest region, and
are enclosed, sixteen to eighteen in number, in a hard, thick
pericarp. Another nut-producing tree is the _sapucaia_ (_Lecythis
ollaria_), whose nuts are enclosed in a larger pericarp, and are
considered to be better flavoured than those first described. The crop
is a variable one, the export in 1905 having been 198,226 hectolitres,
while that of 1906 was 96,770 hectolitres. It could undoubtedly be
largely increased. Vegetable wax, which is an excellent substitute for
beeswax, is a product of the _carnahuba_ palm (_Copernicia cerifera_),
and is an important export from Ceara. Palm, or piassava fibre,
derived from the _piassava_ palm, is used in the manufacture of
brooms, brushes, &c. It is found as far south as southern Bahia, and
the export could be very largely increased. The export of cabinet
woods is not large, considering the forest area of Brazil and the
variety and quality of the woods. This is principally due to the cost
and difficulties of transporting timbers to the coast. The export is
confined principally to rosewood. Of the medicinal plants, the
best-known products are ipecacuanha, sarsaparilla, copaiba, jaborandi
and cinchona, but this is only a part of the list. Besides these,
tonka beans, anatto, vanilla, and castor-oil seeds form a part of the
exports.
The mineral exports are surprisingly small. Gold was discovered by the
Portuguese soon after their settlement of the coast in the 16th
century, but the washings were poor and attracted little attention.
The richer deposits of Minas Geraes were discovered about 1693, and
those of Matto Grosso early in the following century. Abandoned placer
mines are to be found in every part of the unsettled interior, showing
how thoroughly it had been explored by gold-hunters in those early
days. Some good mines, like Morro Velho and the abandoned Gongo Soco,
have been developed in Minas Geraes, but the great majority are small
and not very productive. Diamonds were discovered in Minas Geraes,
near the town now called Diamantina, during the first half of the 18th
century, the dates given ranging from 1725 to 1746, but the
productiveness of the district has greatly decreased. Diamonds have
also been found in Bahia, Goyaz and Parana. Other precious stones
found in Brazil are the topaz, ruby aquamarine, tourmaline,
chrysoberyl, garnet and amethyst. Among the minerals are silver,
platinum, copper, iron, lead, manganese, chromium, quicksilver,
bismuth, arsenic and antimony, of which only iron and manganese have
been regularly mined. The copper deposits of Minas Geraes are said to
be promising. Manganese is mined in Minas Geraes for export. Iron ores
have been found in most of the states, and are especially abundant in
Minas Geraes. The Ypanema mine and ironworks, near Sorocaba, Sao
Paulo, which belong to the national government, have been in operation
since 1810 and small charcoal forges were in operation in colonial
times and supplied the mines with a considerable part of the iron
needed by them. Many of the richer deposits have never been developed
because of a lack of fuel and limestone. Bituminous coal of an
inferior quality is mined to a limited extent in Rio Grande do Sul,
and another mine has been opened in Santa Catharina. These coal
deposits extend from Rio Grande do Sul north into the state of Sao
Paulo. Salt, which does not figure in the list of exports, is produced
along the coast between Pernambuco and Cape St Roque. The annual
production is about 240,000 tons.
To illustrate the comparative productiveness and relationship of these
sources of national wealth and industry, the following official
returns of export for the years 1905 and 1906 are arranged in the four
general classes previously discussed, the values being in Brazilian
gold milreis, worth 2s. 3d. or 54.6 cents to the milreis:--
_Agricultural._
1905. 1906.
Milreis, gold. Milreis, gold.
Coffee . . . . . 190,404,576 245,474,525
Cotton . . . . . 10,290,790 14,726,492
Cacau . . . . . 9,240,313 12,323,922
Tobacco . . . . . 7,335,163 8,283,150
Sugar . . . . . 3,608,476 5,388,596
Bran[7] . . . . . 1,490,312 1,128,761
Cottonseed . . . . 964,074 1,084,742
Mandioca flour . . . 692,079 789,913
Fruits . . . . . 606,678 714,332
Castor-oil seeds . . . 214,016 333,250
----------- -----------
224,846,477 290,247,683
_Natural and Forest._
Rubber:
Mangabeira . . . 1,286,672 1,376,014
Manicoba . . . . 7,418,559 7,335,870
Hevea (Para) . . . 119,434,947 116,229,549
Mate (Paraguay tea) . . 11,088,108 16,502,881
Brazil nuts . . . . 2,064,049 1,190,177
Palm wax (Carnahuba) . . 1,847,273 3,733,478
Cabinet woods . . . 390,070 318,873
Piassaya fibre . . . 336,668 347,323
Medicinal leaves, roots,
resins, &c. . . . 191,534 263,137
----------- -----------
143,331,142 147,297,302
_Pastoral and Animal._
Salted hides . . . . 7,010,498 9,691,180
Dry hides . . . . 5,330,440 7,675,715
Skins. . . . . . 4,117,590 4,639,512
Horse hair . . . . 307,505 403,541
Horns . . . . . 276,172 277,488
Wool . . . . . . 142,414 354,045
Beef extract, &c . . . 81,607 110,925
---------- ----------
17,266,226 23,152,406
_Mineral Products._
Gold, in bars . . . 3,734,469 4,379,160
Manganese ore . . . 2,958,462 1,594,486
Monazite sand . . . 889,231 881,289
Precious stones . . . 633,916 1,480,260
--------- ---------
8,216,078 8,335,195
_Miscellaneous._
Old metals[8]. . . . 263,506 382,073
Sundry products . . . 2,177,512 2,225,163
--------- ---------
2,441,018 2,607,236
----------- -----------
Total, all products . . 396,827,679 471,639,822
_Manufactures._--Before the establishment of the republic very little
attention had been given to manufacturing industries beyond what was
necessary to prepare certain crude products for market. Sugar and rum
were essentially plantation products down to the last ten years of the
empire, when central usines using improved machinery and methods were
introduced as a means of saving the sugar plantations from ruin. The
crude methods of preparing jerked beef were also modified to some
extent by better equipped abattoirs and establishments for preparing
beef extract, preserved meats, &c. There were also mills for crushing
the dried mate leaves, cigar and cigarette factories, small chocolate
factories, hat factories, brick and tile yards, potteries, tanneries,
saddleries, and many other small industries common to all large
communities. Considerable protection was afforded to many of these
industries by the customs tariff of that time, but protection did not
become an acknowledged national policy until after 1889. After that
time the duties on imports were repeatedly and largely increased, both
as a means of raising larger revenues and as an encouragement to
manufacturing enterprise. Although the protective tariffs thus imposed
have resulted in a large increase in manufacturing industries, some of
them have been antagonistic to the productive interests of the
country, as in the case of weaving mills which use imported yarns.
Other industries are carried on entirely with imported materials, and
are national only in name. Among these are flour mills, factories for
the cutting of wire nails and making hollow ware from sheet iron, and
factories for the manufacture of umbrellas, boots and shoes, &c. The
greatest progress has been made in the manufacture of cotton fabrics,
principally of the plainer and coarser grades used by the common
people. There were 155 of these factories in 1895, but in 1905 only
108 were in operation, with 715,000 spindles, and about 37,000
operatives. Nearly one-half of these were weaving mills, using
imported yarn. The factories are widely distributed, and some are
favoured by state legislation in addition to the national tariff. The
largest and best equipped of them are located in the federal states of
Rio de Janeiro and Sao Paulo, though the greater part of the raw
cotton used comes from the northern states and pays high freight
rates. The manufacture of woollen blankets, cashmeres, flannels, &c.,
had also undergone noteworthy development and is carried on in fifteen
factories, located principally in Rio Grande do Sul, Rio de Janeiro
and Sao Paulo. Biscuit-making is represented by a large number of
factories, for the most part in Rio de Janeiro and Sao Paulo, and
there are a number of breweries of the most modern type in the same
two states. The manufacture of boots and shoes has also received much
attention, but the materials used are for the most part imported.
Among other manufactures are butter and cheese, canned fruits and
vegetables, glass and earthenware, printing and wrapping paper,
furniture, matches, hats, clothing, pharmaceutical products, soaps and
perfumery, ice, artificial drinks, cigars and cigarettes, fireworks
and candles.
_Government._--The overthrow of the monarchy by a military revolt in Rio
de Janeiro on 15th November 1889, resulted in the creation of a federal
republic under the name of United States of Brazil (Estados Unidos do
Brazil). The constitution under which the republic is governed was
drafted by a constituent assembly convened on the 15th of November 1890,
and was adopted on the 24th of February 1891. The supreme powers of the
nation are vested in three partially independent branches of
government--executive, legislative, and judicial--represented by the
president and his cabinet, a national congress of two chambers, and a
supreme tribunal. The states forming the federation consist of the
twenty provinces and municipal district of the empire, but the number
may be increased or diminished by the states concerned with the approval
of the national congress. The states are self-governed, and have
exclusive control of the public lands, mines, industries, and all local
affairs. They have the sole right also to impose duties on exports and
taxes upon real estate, industries and professions, and transfers of
property. Among other things they are charged with the supervision and
support of primary education, with the maintenance of order, and with
the organization and support of a system of state courts. Both the
national and state governments exercise the right to impose stamp and
consumption taxes, and the municipalities likewise are permitted to
impose licence and consumption taxes. The national government reserves
for itself the exclusive right to direct the foreign affairs of the
republic, to maintain an army and navy, to impose duties on imports, to
regulate foreign commerce, to collect port dues, to issue money and
create banks of issue, and to maintain a postal and national telegraph
service. It also supervises secondary and superior education, issues
patents, and provides federal courts for the trial of cases amenable to
federal laws. The national government is forbidden to interfere in the
peculiar affairs of the states except to repel foreign invasion, to
maintain a republican form of government, to re-establish order at the
request of a state, or to enforce federal laws and sentences. The states
are forbidden, likewise, to tax federal property, to tax inter-state
commerce, to impose duties of their own on foreign imports, or to resist
the execution of judicial sentences originating in other states. The
separation of church and state is provided for by the constitution, and
both the nation and the states are forbidden to establish, subsidize or
restrict the exercise of any religious worship. Foreigners are eligible
to Brazilian citizenship, and the right of suffrage is conferred upon
all male citizens over twenty-one years of age, except beggars,
illiterates, the rank and file of the armed forces, members of monastic
orders, &c., bound by private vows, and all unregistered citizens.
The executive power of the nation is vested in a president, elected for
a term of four years by a direct vote of the electors. He must be a
native Brazilian over thirty-five years of age, in the full enjoyment of
his political rights, and is ineligible for the next succeeding term. A
vice-president is elected at the same time and under the same
conditions, who is president of the senate _ex officio_, and succeeds to
the presidency in case the office becomes vacant during the last two
years of the presidential term. Should the vacancy occur during the
first two years of the term, a new election must be held. The president
receives a salary of 120,000 milreis and the vice-president of 36,000
milreis. The president is advised and assisted by a cabinet of six
ministers, viz. foreign affairs; finance; agriculture, industry and
commerce;[9] communications (_Viacao_) and public works;[9] war; and
marine. The ministers are appointed and removed by the president, take
no part in the sessions of congress, and are responsible to the
president alone for their advisory acts. The president sanctions and
promulgates, or vetoes, or ignores the laws, and resolutions voted by
congress, and issues decrees and regulations for their execution. His
veto may be over-ridden by a two-thirds vote in each chamber, and
permitting ten days to pass without signing an act is considered as
acquiescence and it is promulgated by congress. The president is charged
with the duties (among others) of commanding the armed forces of the
republic, appointing the prefect of the national capital, designating
members of the supreme tribunal and diplomatic representatives for the
approval of the senate, to negotiate treaties, &c., _ad referendum_ to
congress, and maintain relations with foreign powers, to declare war in
case of invasion and to declare martial law in case of grave internal
disorder, and to advise congress at the opening of the annual session of
the progress and state of public affairs. He may be impeached before the
senate for his official acts and suspended from office, or tried by the
supreme tribunal for criminal offences.
The legislative power is vested in a national congress of two chambers,
elected by direct suffrage, and convened on the 3rd of May each year.
The regular annual sessions are of four months' duration, but they may
be extended to complete necessary legislation. The senate consists of
sixty-three members (three from each state and the federal district)
elected for a period of nine years, one-third of each delegation being
renewed every three years. The senators must be not less than
thirty-five years of age, and are exempt from all legal processes not
previously authorized by the senate during their term of office, except
in cases of arrest _in flagrante delicto_ for a capital crime. The
chamber of deputies contains 212 members, the membership being
distributed among the states on a basis of one for each 70,000 of
population, but with a minimum representation of four for each state.
The deputies are elected by direct suffrage for the legislative session
of three years, and have the same immunities from legal process as the
senators. The chamber has the right of initiative in the organization of
the annual budget laws and those relative to the numerical strength of
the army and navy. The members of both houses receive a _per diem_
subsidy.
The judicial system of the republic consists of a supreme federal
tribunal of fifteen judges in the national capital, and a district
tribunal in the capital of each state, which forms a federal judicial
district. The judges are appointed for life and can be removed only by
judicial sentence and impeachment. One member of the supreme tribunal
holds the position of solicitor-general of the republic. The judges and
solicitor-general are appointed by the president with the approval of
the senate, but the tribunal chooses its own presiding officers and
secretaries and, nominally, is independent of executive control. The
supreme tribunal has original and appellate jurisdiction, but its power
to pass on the constitutionality of federal laws and executive acts
seems to fall short of that of the United States Supreme Court. It has
authority, however, to review the acts and laws of state governments and
to decide upon their constitutionality. The district federal court has
but one judge (_juiz de seccao_) and a solicitor of the republic, and
has original jurisdiction in federal causes. Each state has its own
local laws and courts, independent of federal control, but subject to
the review of the supreme tribunal, and with rights of appeal to that
tribunal in specified cases. The federal district, which has a municipal
council instead of a legislature, has a system of municipal and higher
courts peculiar to itself. Limited judicial powers are exercised by
chiefs of police, and by certain department commissions, or boards, of
an executive character. The members of the army and navy are governed by
special laws, enjoy immunities from civil process, and are subject to
the jurisdiction of military courts. The civil code of the republic is
based upon Roman law.
_Army._--The nominal strength of the army in 1906 was 29,489, including
the officers of the general and subordinate staffs and the officers and
cadets of the military schools. This total represents the nominal
strength of the army in times of peace. Its actual strength, however, is
about 15,000 men, some of the regimental and battalion organizations
being skeletons. Its organization consists of 40 battalions of infantry
with one transport and one depot company, 14 regiments of cavalry of 4
squadrons each, 6 regiments of field artillery with 24 batteries and 6
battalions of heavy artillery with 24 batteries, and two battalions of
engineers. Efforts to organize a national guard have been unsuccessful,
although officers have been appointed and the organization perfected, on
paper. The police force, however, is organized on a military footing and
armed, and is available for service in case of necessity. It is credited
with 20,000 men. According to law military service is obligatory, but
the government has been unable to enforce it. Impressment is commonly
employed to fill the ranks, and in cases of emergency the prison
population is drawn upon for recruits. The president is nominally
commander-in-chief of the army, but the actual command is vested in a
general staff in the national capital, and in the general commanding
each of the seven military districts into which the republic is divided.
The most important of these districts is that of Rio Grande do Sul,
where a force of 11,226 men is stationed. The principal war arsenal is
in Rio de Janeiro. The rifle used by the infantry is a modified Mauser
of the German 1888 model. Military instruction is given at the Eschola
Militar of Rio de Janeiro. The military organization is provided with an
elaborate code and systems of military courts, which culminate in a
supreme military tribunal composed of 15 judges holding office for life,
of which 8 are general army officers, 4 general naval officers and 3
civil judges.
_Navy._--The naval strength of the republic consisted in 1906 of a
collection of armoured and wooden vessels of various ages and types of
construction, of which three armoured vessels (including the two
designed for coast defence), four protected cruisers, five destroyers
and torpedo-cruisers, and half a dozen torpedo boats represented what
may be termed the effective fighting force. The loss of the armoured
turret ship "Aquidaban" by a magazine explosion in the bay of
Jacarepagua, near Rio de Janeiro, in 1905, had left Brazil with but one
fighting vessel (the "Reachuelo") of any importance. Many of the wooden
and iron vessels listed in the Naval Annual, 1906, though obsolete and
of no value whatever as fighting machines, are used for river and
harbour service, and in the suppression of trifling insurrections. The
Annual describes 21 vessels of various types, and mentions 23 small
gunboats used for river and harbour service. Besides these there are a
number of practice boats (small school-ships), transports, dispatch
boats and launches. A considerable part of the armament is old, but the
more modern vessels are armed with Armstrong rifled guns. The naval
programme of the republic for 1905 provided for the prompt construction
of 3 battleships of the largest displacement, 3 armoured cruisers, 6
destroyers, 12 torpedo boats and 3 submarine boats; and by 1909 the
reorganization of the navy was far advanced. The principal naval arsenal
is located at Rio de Janeiro. The government possesses dry docks at Rio
de Janeiro. The naval school, which has always enjoyed a high reputation
among Brazilians, is situated on the island of Enxadas in the bay of Rio
de Janeiro. There are smaller arsenals at Para, Pernambuco, Sao Salvador
and Ladario (Matto Grosso) and a shipbuilding yard of considerable
importance at the Rio de Janeiro arsenal.
_Education._--Education is in a backward condition, and it is estimated
that 80% of the population can neither read nor write. The lowest rate
of illiteracy is to be found in the southern half of the republic.
Public instruction, is, by constitutional provision, under secular
control, but religious denominations are permitted to have their own
schools. Primary instruction is free but not compulsory, and the schools
are supported and supervised by the states. An incomplete return in 1891
gave 8793 schools and 376,399 pupils. Secondary and higher education are
under both federal and state control, the former being represented by
lyceums in the state capitals, and by such institutions as the Gymnasio
Nacional (formerly Collegio Dom Pedro II.) in Rio de Janeiro. Many of
the states also maintain normal schools of an inferior type, that of Sao
Paulo being the best and most modern of the number. Higher, or superior,
instruction is confined almost exclusively to professional schools--the
medical schools of Rio de Janeiro and Bahia, the law schools of Sao
Paulo and Pernambuco, the polytechnic of Rio de Janeiro, and the school
of mines of Ouro Preto. There are many private schools in all the large
cities, from the primary schools maintained by the church and various
corporations and religious associations to schools of secondary and
collegiate grades, such as the Protestant mission schools of Petropolis,
Piracicaba, Juiz de Fora, Sao Paulo and Parana, the Lyceu de Artes e
Ofiicios (night school) of Rio de Janeiro, and the Mackenzie College of
Sao Paulo. Perhaps the best educational work in Brazil is done in these
private schools. In addition to these there are a number of seminaries
for the education of priests, where special attention is given to the
classics and belles-lettres.
_Religion._--The revolution of 1889 and the constitution adopted in 1891
not only effected a radical change in the form of government, but also
brought about the separation of church and state. Before that time the
Roman Catholic Church had been recognized and supported by the state.
Not only are the national and state governments forbidden by the
constitution to establish or subsidize religious worship, but its
freedom is guaranteed by a prohibition against placing obstructions upon
its exercise. The relations of the state with the disestablished church
since 1889 have been somewhat anomalous, the government having decided
to continue during their lives the stipends of the church functionaries
at the time of disestablishment. The census of 1890 divided the
population into 14,179,615 Roman Catholics, 143,743 Protestants, 3300 of
all other faiths, 7257 of no religious profession, and 600,000
unchristianized Indians. The increase of population through immigration
is overwhelmingly Catholic, and the nation must, therefore, continue
Roman Catholic whether the church is subsidized by the state or not. The
moral character of churchmen in Brazil has been severely criticized by
many observers, and the ease with which disestablishment was effected is
probably largely due to their failings. The church had exercised a
preponderating influence in all matters relating to education and the
social life of the people, and it was felt that no sweeping reforms
could be secured until its domination had been broken. The immediate
results of disestablishment were civil marriage, the civil registry of
births and deaths, and the secularization of cemeteries; but the church
retains its influence over all loyal churchmen through the confessional,
the last rites of the church, and their sentiment against the
profanation of holy ground. Formerly Brazil constituted an
ecclesiastical province under the metropolitan jurisdiction of an
archbishop residing at Bahia, with 11 suffragan bishops, 12
vicars-general and about 2000 curates. In 1892 the diocese of Rio de
Janeiro was made an archbishopric, and four new dioceses were created.
Three more have been added since, making twenty dioceses in all. In 1905
the archbishop of Rio de Janeiro was made a cardinal. The church has
eleven seminaries for the education of priests, and maintains a large
number of private schools, especially for girls, which are patronized by
the better classes. The church likewise exercises a far-reaching
influence over the people through the beneficent work of its lay orders,
and through the hospitals and asylums under its control in every part of
the country. A Misericordia hospital is to be found in almost every town
of importance, and _recolhimentos_ for orphan girls in all the large
cities. In no country have these charities received more generous
support than in Brazil. The Protestant contingent consists of a number
of small congregations scattered throughout the country, a few
Portuguese Protestants from the Azores, a part of the German colonists
settled in the central and southern states, and a large percentage of
the North Europeans and Americans temporarily resident in Brazil. The
Positivists are few in number, but their congregations are made up of
educated and influential people.
_Art, Science and Literature._--The Brazilian people have the natural
taste for art, music and literature so common among the Latin nations of
the Old World. The emperor Dom Pedro II. did much to encourage these
pursuits, and many promising young men received their education in
Europe at his personal expense. Still earlier in the century (1815) the
regent Dom John VI. brought out a number of French artists to educate
his subjects in the fine arts, and the _Escola Real de Sciencias, Artes
e Officios_ was founded in the following year. From this beginning
resulted the _Academia de Bellas Artes_ of a later date, to which was
added a conservatory of music in 1841. The institution is now called the
_Escola Nacional de Bellas Artes_. Free instruction in the fine arts has
been given in this school. The higher results of artistic training,
however, are less marked than a widespread dilettantism. The Brazilian
composer Carlos Gomes (1839-1896) is the best known of those who have
adopted music as a profession, his opera _Il Guarani_ having been
produced at most of the European capitals. The most prominent among
Brazilian painters is Pedro Americo, and in sculpture Rodolpho
Bernardelli has done good work. In science Brazil has accomplished very
little, although many eminent foreign naturalists have spent years of
study within her borders. Joao Barbosa Rodrigues has done some good work
in botany, especially in the study of the palms of the Amazon, and Joao
Baptista de Lacerda has made important biological investigations at the
national museum of Rio de Janeiro. There are several scientific
societies and institutions in the country, but they rarely undertake
original work. The most active are the geographical societies, but very
little has been done in the direction of scientific exploration. Some
interesting results have been obtained from the boundary surveys, from
Dr E. Cruls's exploration of a section of the Goyaz plateau in 1892 in
search of a site for the future capital of the republic, and from some
of the river and railway surveys. In 1875 a geological commission was
organized under the direction of Professor Charles Frederick Hartt, but
it was disbanded two years later. In 1906 Congress resolved to undertake
a national geological survey under the direction of Mr Orville A. Derby,
one of Professor Hartt's assistants. The coal resources of the southern
states were investigated in 1904, under the auspices of the national
government, by Dr J.C. White, of the U.S. Geological Survey, who found
strata of fairly good coal at depths of 100 to 200 ft. extending from
Rio Grande do Sul north to Sao Paulo. The more important contributions
to our present knowledge of Brazil, however, have been obtained through
the labours of foreign naturalists. Beginning with the German
mineralogist W.L. von Eschwege, who spent nineteen years in Brazil
(1809-1828), the list includes A. de Saint-Hilaire (1816-1820 and
1830), J.B. von Spix and C.F. von Martins (1817-1820), Prince Max zu
Neuwied (1815-1817), P.W. Lund (1827-1830, and 1830 to 1880, the year of
his death), George Gardner (1836-1841), A.R. Wallace (1848-1852), H.W.
Bates (1848-1859), Hermann Burmeister (1850-1852), Louis Agassiz
(1865-1866), Charles Frederick Hartt (1865-1866, 1872 and 1875-1878) and
Karl von den Steinen (1884-1885 and 1887-1888). These explorations cover
every branch of natural science and resulted in publications of
inestimable scientific value. There should also be mentioned the
monumental work of C.F.P. von Martius on the _Flora Braziliensis_, and
the explorations of Agassiz and Lund. Among other scientists of a later
date who have published important works on Brazil are the American
geologists O.A. Derby and J.C. Branner, the Swiss naturalist E.A.
Goeldi, the German botanist J. Huber, the German ethnologist H. von
Ihring, and'the German geographer Fried. Katzer. The _Instituto
Historico e Geographico Brazileiro_, though devoted chiefly to
historical research, has rendered noteworthy service in its
encouragement of geographical exploration and by its publication of
various scientific memoirs. The Museu Nacional at Rio de Janeiro, which
has occupied the imperial palace of Sao Christovao since the overthrow
of the monarchy, contains large collections of much scientific value,
but defective organization and apathetic direction have rendered them of
comparatively slight service. The Observatorio Nacional at Rio de
Janeiro is another prominent public institution. The botanical gardens
of Brazil are developing into permanent exhibitions of the flora of the
regions in which they are located. That of Rio de Janeiro is widely
celebrated for its avenues of royal palms, but it has also rendered an
important service to the country in the dissemination of exotic plants.
Brazilian literature has been seriously prejudiced by partisan politics
and dilettantism. The colonial period was one of strict repression, the
intellectual life of the people being jealously supervised by the church
to protect itself against heresy, and their progress being restricted by
the Portuguese crown to protect its monopoly of the natural resources of
the country. The arrival of Dom John VI. in 1808 broke down some of
these restrictions, and the first year of his residence in Rio de
Janeiro saw the establishment of the first printing press in Brazil and
the publication of an official gazette. There was no freedom of the
press, however, until 1821, when the abolition of the censorship and the
constitutional struggle in Portugal gave rise to a political discussion
that marked the opening of a new era in the development of the nation,
and aroused an intellectual activity that has been highly productive in
journalistic and polemical writings. In no country, perhaps, has the
press exercised a more direct and powerful influence upon government
than in Brazil, and in no other country can there be found so high a
percentage of journalists in official life. Some of the political
writers have played an important part in moulding public opinion on
certain questions, as in the case of A.C. Tavares Bastos, whose _Cartas
do Solitario_ were highly instrumental in causing the Amazon to be
thrown open to the world's commerce and also in preparing the way for
the abolition of slavery; and in that of Joaquim Saldanha Marinho, whose
discussions in 1874-1876 of the relations between church and state
prepared the way for their separation. The personal element is
conspicuous in the Brazilian journalism, and for a considerable period
of its history libellous attacks on persons, signed by professional
sponsors, popularly called _testas de ferro_ (iron heads), were admitted
at so much a line in the best newspapers.
The singular adaptability of the Portuguese language to poetical
expression, coupled with the imaginative temperament of the people, has
led to an unusual production and appreciation of poetry. The percentage
of educated men who have written little volumes of lyrics is
surprisingly large, and this may be accounted for by the old Portuguese
custom of reciting poetry with musical accompaniment. The most popular
of the Brazilian poets are Thomaz Antonio Gonzaga, Antonio Goncalves
Dias and Bernardo Guimaraes. Among the dramatists and novelists may be
mentioned Joaquim Manoel de Macedo, Jose Martiniano de Alencar, Bernardo
Guimaraes, A. de Escrangnolle Taunay and J.M. Machado de Assis. Jose M.
de Alencar is usually described as the greatest of Brazilian novelists.
The most popular of his romances are _Iracema_ and _O Guarany_. In
historical literature Brazil has produced one writer of high
standing--Francisco Adolpho Varnhagen (Visconde de Porto Seguro), whose
_Historia Geral do Brazil_ is a standard authority on that subject. The
two English authorities, Robert Southey's _History of Brazil_, covering
the colonial period, and John Armitage's _History of Brazil_, covering
the period between the arrival of the Braganza family (1808) and the
abdication of Dom Pedro I. (1831), have been translated into Portuguese.
Another Brazilian historian of recognized merit is Joao Manoel Pereira
da Silva, whose historical writings cover the first years of the empire,
from its foundation to 1840. Among the later writers Joao Capistrano de
Abren has produced some short historical studies of great merit. In the
field of philosophic speculation, Auguste Comte has had many disciples
in Brazil.
_Finance._--The national revenue is derived largely from the duties on
imports, the duties on exports having been surrendered to the states
when the republic was organized. Other sources of revenue are stamp
taxes on business transactions, domestic consumption taxes (usually
payable in stamps) on manufactured tobaccos, beverages, boots and
shoes, textiles, matches, salt, preserved foods, hats, pharmaceutical
preparations, perfumeries, candles, vinegar, walking sticks and
playing cards, and taxes on lotteries, passenger tickets, salaries and
dividends of joint-stock companies. Formerly import duties were
payable in currency, but in 1899 it was decided to collect 10% of them
in gold to provide the government with specie for its foreign
remittances. The revenues and expenditures have since then been
calculated in gold and currency together, to the complete
mystification of the average citizen, and the gold percentage of the
duties on imports has been increased to 35 and 50% (in 1907), the
higher rate to apply to specified articles and rule when exchange on
London is above 14 pence per milreis, and the lower when it is below.
The service of the national debt absorbs a very large part of the
expenditure, about 45% of the estimates for 1907 being assigned to the
department of finance. The department of industry, communications and
public works takes the next highest proportion, but about half its
expenditures are met by special taxes, as in the case of port works
and railway inspection, and by the revenues of the state railways,
telegraph lines and post office. The depreciation and unstable
character of the paper currency render it difficult to give a clear
statement of receipts and expenditures for a term of years, the
sterling equivalents often showing a decrease, through a fall in the
value of the milreis, where there has been an actual increase in
currency returns. This was most noticeable between 1889 and 1898, when
exchange, which represents the value of the milreis, fell from a
maximum of 27-3/4 pence (27d. being the par value of the milreis) to a
minimum of 5-5/8 pence. Since 1898 there has been an upward movement
of exchange, the average rate for 1905 having been very nearly 16
pence. In this period the increase in the sterling equivalents would
be proportionately greater than that of the currency values. The gold
and currency receipts and expenditures for the six years 1900 to 1905,
inclusive, according to official returns, were as follows:--
+------+---------+---------------------------+--------------------------+
| | Average | Revenue. | Expenditure. |
| Year.| Rate of +-------------+-------------+------------+-------------+
| |Exchange.| Gold | Currency | Gold | Currency |
| | Pence. | Milreis. | Milreis. | Milreis. | Milreis. |
+------+---------+-------------+-------------+------------+-------------+
| 1900 | 9.50 | 49,955,522 | 263,687,253 | 41,892,150 | 372,753,986 |
| 1901 | 11.38 | 44,041,302 | 239,284,702 | 40,493,241 | 261,629,212 |
| 1902 | 11.97 | 42,904,844 | 266,584,912 | 34,574,643 | 236,458,862 |
| 1903 | 12 | 45,121,844 | 327,370,063 | 48,324,642 | 291,198,960 |
| 1904 | 12.28 | 50,566,572 | 342,782,191 | 48,476,413 | 352,292,147 |
| 1905 | 15.89 | 64,207,004 | 243,355,396 | 51,606,272 | 265,699,281 |
+------+---------+-------------+-------------+------------+-------------+
Reducing gold to a currency basis at 15d. per milreis (the official
valuation adopted in 1906), the budget for 1907 provided for a revenue
of 353,590,593 milreis and an expenditure of 409,482,284 milreis,
showing a deficit of 55,891,691 milreis. These deficits were common
enough under the monarchy, but they have become still more prominent
under the republic. According to the "Retrospecto Commercial" for 1906
of the _Jornal do Commercio_ (Rio de Janeiro, March 5, 1907), the
aggregate deficits for the eleven years 1891 to 1904 were 692,000,000
milreis, or, say, L43,250,000.
The natural result of such a regime is increasing indebtedness. In
1888, a year before the republic was proclaimed, the internal and
external national debts amounted to L74,000,000 sterling, with the
currency at par. Ten years later, when the currency had fallen to
5-5/8 pence per milreis, the government found itself unable to meet
the interest obligations on its debt and railway guarantees, and an
arrangement was made with its creditors in London for the issue of a
5% funding loan to an amount not to exceed L10,000,000, and the
suspension of all amortization for thirteen years. On the other hand
the government agreed to withdraw currency, which had reached a total
of 788,364,614 1/2-milreis, _pari passu_ with the issue of the loan,
the milreis being computed at 18 pence. The purpose of this condition
was in order to improve the value of the paper milreis in order to
increase the specie value of the revenues. The scheme came into
operation in June 1898, and not only was a complete suspension of
payments avoided but the financial situation was greatly improved. The
government even withdrew more of its currency issues than required by
the agreement, and the value of the milreis steadily improved. At the
same time the government carried out the forced conversion of the
national loans into lower interest-bearing issues, which greatly
reduced the annual interest charges. These measures would have put the
financial affairs of the nation on a solid footing in a very few years
had the government been able to keep its expenditure within its
income. The naval revolt of 1893-1894, however, had aroused the spirit
of militarism in the ruling classes, and the effort to perfect the
organization and equipment of the army, strengthen the fortifications
of Rio de Janeiro, and increase the navy, have kept expenditures in
excess of the revenues. The purchase of guaranteed railways owned by
foreign companies likewise added largely to the bonded indebtedness,
though the onus was in existence in another form. The result of these
measures was a large addition to the public debt, which on 31st
December 1906 was approximately as follows (_apolices_ being the name
given to bonds inscribed to the holder):--
External debt: L s. d.
Loans of 1883, 1888 and 1889. 26,478,500
Oestede Minas R.R. loan 3,388,100
Loan of 1898 7,331,600
Funding loan of 1898 8,613,717 9 9
Railway rescission loan of 1901 15,467,015 16 1
Port works loan of 1903 8,500,000
-------------------
L69,778,933 5 10
===================
Internal debt, funded: Milreis
5 % apolices, Law of 1827 483,546,600
4-1/2% " " 1879 20,548,000
6 % " " 1897 37,082,000
5 % " " 1903 17,300,000
-----------
Total, funded 558,476,600
(at 15d. L34,904,787) ===========
Internal debt, not funded: Milreis
Paper money 664,792,960
Savings bank and other deposits:
In paper 246,812,407
In gold, 19,053,861 r (say) 34,296,950
Floating indebtedness (a/cs current, bills, &c.) ?
-----------
Total, not funded, approx. 945,902,317
(at 15d. L59,118,895 stg.) ===========