SOME OF THE OBSTACLES TO NORTH

AMERICAN TRADE IN BRAZIL

By John C. Branner, LL.D., President of
Stanford University

I am not and never have been directly interested in trade. During the ten years of my travels in Brazil I have been in the employ of the Brazilian government as a geologist, or I have been otherwise engaged in the study of the geology and natural history of the country. My travels, however, have taken me into all parts of the country, into nearly every one of the Brazilian states, and among all classes of people. What I have to say therefore is based entirely on my own observations and on what I could learn from the people rather than upon hearsay or upon such information as one can pick up in the seaports and in the large cities.

I cannot undertake to discuss or even to mention all of the obstacles to North American trade in Brazil for the reason that I do not pretend to know what all of those obstacles are. In the brief time I can give to the subject I shall only ask your attention to such obstacles as have come to my attention and for which we North Americans are ourselves responsible.

I assume at the outset that it is generally known that Brazil exports the bulk of her products to the United States, and that she imports the bulk of foreign supplies from Europe.

These facts may be readily gathered from statistics, and they may be seen in process in the large Brazilian cities which are the ports of entry and distributing centers, such as Pará, Pernambuco, Bahia, Rio de Janeiro, and Santos. But the impression that one gets in the large cities where the commission merchants are well supplied with samples, and stand ready to receive orders for American as well as for European goods, are not nearly as convincing as that

THE JOURNAL OF RACE DEVELOPMENT, VOL. 4, NO. 4, 1914

which one gets on the frontier of trade, that is in the shops of the small dealers, in the homes of the planters and cattle growers, and in the humble cabins of the poor fishermen, or of the rubber cutters of the interior.

The shelves of the little retail shops through the distant interior of Brazil furnish the self-satisfied North American enlightening visions that cannot be seen or appreciated in the up-to-date shops of the Rua d'Ouvidor or on the fashionable avenues of Rio de Janeiro. For these little up-country shops are the distributing posts for everything of foreign manufacture that reaches the common people and the laboring classes all through the enormous interior of that country. The commission merchants of the coast cities keep all sorts of things, many of which may seldom or never be sold. But the up-country dealer cannot afford to pay the transportation on mule-back over a thousand miles of almost impassable bridle-paths upon things that there is any doubt about his selling. One may therefore be very sure that the goods in the retail shops of the interior are there because the dealer knows they will be sold-that there is a sure market for them, however small the demand.

In such a place one usually finds the following articles of North American manufacture: kerosene oil, Singer sewing machines, cheap clocks, Ayres' proprietary medicines, and Lanman and Kemp's Florida water. Everything else is of British, German, French, Italian, or Portuguese manufacture. I have myself seen hundreds and hundreds of such stores.

It is my purpose to ask your attention to the reasons for this state of affairs as they appear to an uncommercial traveler, and in so far as we are responsible for it.

It is in the retail shops I have mentioned that one fully realizes what some of the obstacles are to our trade with Brazil, for it is chiefly in them that some of these obstacles are operative.

The obstacles to North American trade with Brazil that have attracted my attention on the ground are these:

1. Our ignorance and indifference to the language of the country.

2. Our ignorance of and indifference to the customs of the people, and consequently to the demands of the trade.

3. Bad packing or indifference to the methods of transportation in the interior.

4. Indifference to the credit system of the country.

5. Our lack of serious intention to build up and maintain permanent business.

6. Fatal and unscrupulous business methods, including the sale to the Brazilians of things the people cannot use and should not buy.

7. Our high tariff laws which render competition with other countries difficult.

8. Finally I shall refer briefly to what are often spoken of as obstacles to trade, namely the absence of American ships and American banks.

The language. The language of Brazil is Portuguese, but there is a wide-spread impression in this country that the language is Spanish. A great many people have the delusion that, even if the language is not Spanish, the Spanish will do just as well. I assure you that this is a serious and a fatal error. It is true that Spanish is generally understood along the frontier with Uruguay, Bolivia, and Peru, just as it is in this country along the Mexican frontier, but through the interior and over the great body of the country the Spanish language is as little known as it is in the United States. Over and over again I have seen efforts made to sell in Brazil articles that have to be accompanied by printed directions, as in case, for example, of medicines, and the directions were sent out in Spanish.

I venture the guess that if an American manufacturer wanted to send a traveling salesman to work up trade in Brazil for the first time, he would, in nine cases out of ten, supply him with catalogues printed in the Spanish language. I venture a second guess that the aforesaid manufacturer would instinctively look for a salesman who understood Spanish. And I venture a third guess that the Spanish speaking salesman with the Spanish catalogues would make a first class mess of any business he might attempt in Brazil. Persons who contemplate business with Brazil cannot

attach too much importance to the Portuguese language. And by Portuguese I do not mean bad Spanish, nor do I mean a sailor's vocabulary of unconjugated verbs and undeclined adjectives and articles. I mean the Portuguese language grammatically spoken. The merchants of Brazil are generally men of good breeding, and they resent doing business with persons whose language suggests that they belong to the ignorant classes.

It may be worth noticing in this connection that men familiar with both Portuguese and English can be readily found at New Bedford, Massachusetts, and about Oakland and Sacramento in California.

Customs of the country. It goes without saying that, like other people, the Brazilians have some customs peculiarly their own, and they have certain others that are peculiarly not ours. These customs lead to the use of articles that are but little or not at all used in our own country. In studying the market conditions in Brazil it seems clear that such matters should be given proper consideration. I have found, however, among some of the hopeful beginners in the Brazilian field the impression that the people only needed to be told what to buy and they would buy it; that they only needed to be reminded that this is all the fashion in the states. But Brazilians are conservative, and they are also human, and they are very like some of us in this, that when they are buying a thing they like to buy what suits them and to buy it of the size, color and in the quantity that suits.

I once found that in a certain region an unsuccessful effort had been made to introduce American calicoes. The case interested me, and I made some inquiries about it. I found that the American calico was regarded as superior to the British article being sold in competition with it, but the American calico was put up in large bolts, while the British goods were done up and sold in dress pattern bolts of a definite number of meters, and each one had a pretty label pasted on it. At that time the American manufacturers urged that one could cut off from the American bolt as many or as few meters as were wanted. But though the Americans had

the reasons and the better goods on their side, the British merchants got the trade.

In this connection perhaps I should note that the metric system is legal and the one in common use in Brazil.

Packing. The effect of indifference to proper packing may not be at all apparent to one acquainted only with the trade in the sea-ports and along the railway lines, but to a person familiar with the roads of the interior packing at once seems a matter of prime importance.

It should not be forgotten that Brazil is an enormously big country quite as big as the United States-that the railways are comparatively few, and that the greater part of the country is remote from them. Wagon roads as we know them in the United States cannot be said to exist over most of the interior, though they are extending rapidly in the southern states. The result is that goods going into the interior have to travel for weeks or even months on the backs of pack-mules. There is absolutely no other way for them to be moved.

Goods, in order to reach their destination in the interior, must evidently either be packed for shipment at the factory, or they must be repacked before they can start on these long overland journeys.

How many of our merchants know or concern themselves with the fact that goods shipped into the interior of Brazil should be so done up that two packages will make an average load for the pack animals; that these loads must be put on and taken off the animals at least twice a day, that the packages must withstand tropical sunshine and be exposed to tropical rains; that they must be strong enough to be unhurt by a thousand bumps against trees and rocks along the roads, and must be rolled in the mud and dust over and over again before they reach their final destination?

The European merchants know these things, keep them in mind, and pack the goods so that they are of convenient sizes and weights and otherwise properly conditioned. The American manufacturer says we do our goods up in boxes of such and such sizes, shapes, and weights; there they are;