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Rich Country Protected And Planned Its Industry Before “Selling” Free Trade. Brazil Did The Opposite: Opened Early, Disassembled Sectors (Gurgel, Engesa) And Became An Assembler.
The debate on the role of the State in the economy has returned to the center of attention. According to investor and writer José Kobori, history shows that no country industrialized without strong and planned state intervention. While China maintains 96 active state-owned conglomerates and the United States imposed a 100% tariff against BYD cars to protect its local industry, Brazil opened the market in the 1990s without any countermeasures and saw the bankruptcy of initiatives such as Gurgel (automobiles) and Engesa (defense).
The reading is clear: rich countries defended and financed their industries until they became competitive; only then did they “sell” the idea of free trade.
Brazil did the opposite opened early and disassembled sectors that could have supported greater technological independence.
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What Major Powers Have Done
The American example is old. Alexander Hamilton, one of the founders of the USA, advocated tariffs, planning, and protection against the agro-export specialization that many preached.
If it had followed the script of external comparative advantages, the USA could have become a country dependent on agriculture, like Brazil.
The United Kingdom did the same: it consolidated its textile and naval industries with strong state support before opening the market.
South Korea, under Park Chung-hee, shielded brands like Hyundai, forcing multinationals to transfer technology. Japan protected Toyota, Sony, and Panasonic until they became globally competitive.
China is the most explicit case: 96 state-owned conglomerates lead critical sectors, and even private companies have the Communist Party’s presence on their boards to align goals with the national plan.
BYD, which surpassed Tesla in global electric vehicle sales, is a direct result of this policy.
And, when it advanced too much, the USA reacted: 100% tariff on Chinese electric vehicles to support Tesla and the American automotive sector.
The Brazilian Contrast
In Brazil, the scenario was different. Until the 1980s, there were niches in technology and defense, such as Gurgel, which produced genuinely national cars, and Engesa, which exported armored vehicles like the Cascavel.
Both succumbed after the opening of the 1990s, led by the Collor government, which exposed national companies to foreign competition without requiring technological compensation.
In practice, the country became a “maquiladora”: automakers produce in Brazil but import critical components.
The same happened in defense: Engesa closed, despite having developed solutions that were even more advanced than the American ones in some combat systems.
When the State provided protection, there was success. Embraer, created as a state-owned company, only became a global reference in aviation because it had public support before privatization.
The same applies to Embrapa, which transformed Brazil into an agro-export powerhouse. Today, exceptions like WEG show that it is still possible to compete, but the rule is deindustrialization.
What “State” Means In This Debate
According to Kobori, the role of the State can be divided into three layers:
Long-Term Planning – defining where the country wants to be in 40 or 50 years.
Active Industrial Policy – with goals, temporary protection, and requirements for technology transfer.
Investment in Science and Technology – in areas that the private sector avoids due to high risk and sunk costs.
Examples abound: DARPA, in the USA, funded research that led to the internet and various technologies that are now on cell phones. In Brazil, Embrapa did the same in agriculture.
The Challenge of Reindustrialization
The military dictatorship left ambiguous lessons. There were national development plans (PNDs) that expanded industrialization, but financing through foreign debt and oil shocks generated inflation and crisis.
For Kobori, the problem was not planning but the way of financing.
Today, without a state plan, Brazil sees young generations grow up in a country of low technological density and external dependence.
To reverse this, it would be necessary to demand technology from those who set up operations, finance public R&D, protect strategic sectors, and demand clear results.
The history shows that when the Brazilian State protected, national champions emerged; when it opened without compensation, entire sectors were lost.
The contrast with China, the USA, Japan, and South Korea highlights that the global dispute is not between “State” and “market,” but about how the State organizes the market in favor of its industry.
And you, do you believe that Brazil can still recover its industry or has it lost the race forever?
We want to hear your opinion in the comments.
Enquanto não aprendermos fazer planejamento de longo prazo e não tivermos políticas de incentivo a ciência e tecnologia não vamos ter pais soberano políticas improvisadas ao calor das discussões vamos ter este país que temos sem políticas educacionais de saúde e segurança
Os bancos só visam lucros, os empréstimos são provas disso. Infelizmente o brasileiro só olha o próprio umbigo.
Enquanto o Governo Federal ficar só aumentando impostos, não corrigir essa atual tabela do Imposto de Renda, a carga tributária brasileira é muito grande em cima dos empresários, pra se manter um empregado, paga-se uma quantidade de tributos.
Concordo, afeta a distribuição de renda e tem efeito cascata. E também acho que os impostos fazem parte de um problema sistêmico, com o mercado interno controlado por poucas empresas, o valor dos fretes altos, encargos trabalhistas etc.