Sao Paulo

Credit is a problem in Brazil. Factors like: lack of capitals; a law which overprotectes debtors and underprotects creditors; high interest rates, among others, have been preventing a growth of credit in Brazil.

This week, the total volume of credits in Brazil reached R$ 1 trillion (about US$ 600 billion), the highest volume in the History of the country; that volume amounts to 36% of GNP, also the highest figure ever.

The graph below shows the total credit as percentage of GNP over the past few years.

It is noticeable that credit has been growing very fast. The reasons are the opposite of the factors mentioned in the top paragraph: there is an abundance of capitals (foreign investors are bringing large amounts of money into the country); laws are being passed to safeguard the creditors (for example, specific laws have been giving protection to banks which loan money for purchase of vehicles and real estate); interest rates have been falling.

And, as São Paulo has the biggest economy in Brazil, a good part of that credit was directed to people in the State. And the consequences are visible: the market for cars is hot, and the traffic jams are getting worse; real estate prices are reaching new record levels; the poorer classes (which never had credit before) are buying stuff like computers, TVs and the like, making their lives happier and increasing the popularity of President Lula in the process.

On May 10th 2008, Governor José Serra opened to the public the newest bridge of São Paulo; the bridge is official called Bridge Octavio Frias de Oliveira (Mr. Frias, who died in 2007 at age 94, was the publisher of newspaper Folha de Sao Paulo, one of the most important in Brazil). Despite this official name though, the bridge is becoming known as Ponte Estaiada, which is the Portuguese for Suspended Bridge.

The bridge is located over the river Pinheiros, and connects avenue Roberto Marinho to the Marginal Pinheiros; about 5,000 vehicles per hour, each way, should cross the bridge at peak times.

Besides being useful to relief traffic jams, the bridge, thanks to its grandness and beautiness, is also becoming a tourism spot of São Paulo.

This will be the longest curved suspended  bridge in the world, 290 meters (950 feet) long each way; the large X in the middle is 138 meters (450 ft) tall; a set of 144 steel cables were used to hold the structure.

See Veja magazine for details (in Portuguese) about the construction of the bridge; see aerial images of the bridge.

Despite heavy investments in the transportation infrastructure, drivers of São Paulo still have to face awful traffic jams. Newspaper O Globo informed that in the morning of March 6th 2008, São Paulo faced 165 km (about 103 miles) of jammed streets, the highest figure ever (the former record, of 145 km, had been set just two days ago).

The traffic flow is monitored daily by Companhia de Engenharia de Tráfego - Company of Engineering of Traffic - CET; CET monitors 820 km of the busiest streets in the city via sensors and cameras; the information is available on-line in real time at this map of transit flow in São Paulo.

O Globo interviewed several specialists, who appointed several flaws in the way that São Paulo deals with the problems of transit and transportation. There are fewever vehicles in São Paulo than in Los Angeles (there are 6 million cars in the city of São Paulo, and 9,5 million in the metropolitan area), but cars move faster in LA thanks to a better infrastructure.

One serious problem is the lack of long term planning. For example, most vehicles going from the interior of the State to the Port of Santos must drive across the city, because of lack of alternatives; there is a plan for the construction of a Rodoanel (Ring Drive) around the city, but it started to be built over ten years ago and to date only 32 km (20 mi) were finished.

Other reason mentioned is the rapid growth in the number of vehicles (over the last decade, the fleet grew ten times more than the population) coupled with the proverbial lack of education of Brazilian drivers. Everyday, several accidents happen because of misconduts, and each single accident may be enough to slow down transit for several hours.

Newspaper O Globo published a report today informing that taxis in São Paulo are the most expensive in Brazil. And the long traffic jams, usual in the city, make the situation even worse; this happens because the taxi fares have three components: a starting fare (called “bandeirada”), that passengers pay just for boarding the taxi; a fare per kilometer; and a different fare, per hour, which starts to add automatically to the meter as soon as the speed falls below 20 km/h (12 mi/h).

Below, comparison of taxi prices in a few Brazilian cities (bandeirada + price per km + price per hour at low speeds):

São Paulo:  R$ 3,50 + R$ 2,10 + R$ 28,00

Rio de Janeiro: R$ 4,30 + R$ 1,25 + R$ 15,75

Porto Alegre: R$ 2,76 + R$ 1,37 + R$ 10

Brasília: R$ 3,30 + R$ 1,40 + R$ 18

Recife: R$ 3,00 + R$ R$ 1,40 + R$ 11

Natal: R$ 3,00 + R$ 1,71 + R$ 17,54

On top of that, passengers start to pay a 50% surcharge as soon as the taxi leaves the city of São Paulo and enters a neighbor city, such as Guarulhos and São Bernardo. And, of course, there is a weekend and late night surcharge (called Bandeira 2), of 40%.

The high prices are causing a decrease in the number of passengers. According to the taxi drivers Union, there were about 800,000 passengers a day back in the 1980s, which dropped to about 350,000 nowadays. Many passengers today are employees of corporations (which pay the bills) or attendants of events.