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Booming Businesses



Black businesses fueling Brazil’s new middle class

Fueled by a growing economy and a government program aimed at reducing inequality, black Brazilian entrepreneurs, especially women, are pushing their way into the nation's rapidly growing middle class. Nearly 80 percent of Brazil's new members of the middle class are black.

RIO DE JANEIRO, Brazil – (TheROOT.com) – Just 12 years ago, Adriana Barbosa was unemployed and selling clothes at tiny street bazaars. It was the 21st century, but Barbosa realized that much of the country’s Afro-Brazilian population was still unable to find products and services designed for them.

So she created Feira Preta, a cultural fair where hundreds of black exhibitors showcase various products, from traditional hairstyles and beauty products to English courses focusing on black culture. Today, her business interests encompass a production company and promotional business, and she is branding Feira Preta throughout Brazil.

Barbosa’s success is far from an isolated incident. Black Brazilian entrepreneurs, especially women, are pushing their way into the country’s rapidly growing middle class.

Fueled by a blossoming economy and a government program aimed at reducing income inequality, approximately 80 percent of Brazil’s new members of the middle class are black. Over the past decade, the middle class has grown by 38 percent, according to government reports from the Strategic Affairs Secretariat of the Presidency.

Incomes of black Brazilians, meanwhile, grew by 123 percent between 2000 and 2012 – five times faster than the rest of the population, according to a report by Globo newspaper in 2012.

“It is a highly promising segment,” Barbosa says of Afro-Brazilian consumers. “Today people self-declare as black, and ... there is entrepreneurial opportunity. The market needs to see this population. There are few companies developing products specifically for blacks.”

Before Barbosa started Feira Preta in 2002, many of the types of black businesses and institutions that are commonplace in the U.S. were practically or wholly nonexistent. The new millennium has brought the country’s first and only black university, first black magazine, first black cultural expo, first black business group, first black TV network and the first black actor to star in a prime-time television show. Reighan Gillam, a postdoctoral research fellow in the Department of Afroamerican and African Studies at the University of Michigan, wrote her dissertation on the country’s first black TV network, TV da Gente. Despite its eventual demise, TV da Gente, which was launched in 2005, was a milestone in Brazil’s new commitment to black identity, Gillam said.

“Even in the midst of few resources and very little institutional support... people still persist and demand that black representation exist,” she says, “and they’re going to produce it whether it’s on national TV or not.”

Black pride on rise

The economic boom for blacks has come in concert with a newfound recognition of blackness. While many Brazilians of African ancestry still choose not to identify as black, the designation of preto or preta, which is translated as “black” or “Negro” and was once considered offensive, is beginning to pick up steam in the country. On the 2010 census, only 7.6 percent of Brazil’s 51 percent black population identified as preto, but that was the highest percentage ever.

This has been a catalyst for entrepreneurs like Michelle Fernandes, who started her business, Boutique de Krioula, about a year ago. She says that hers and other black businesses have been created as a direct result of the changing attitudes.

“This comes from the black consciousness that Brazilians have come to take lately,” she says of the success of Brazil’s new black businesses. “We see black men and black women increasingly proud of our roots.

[We want] to know more about our culture and consume products that have to do with our identity and that are made by other blacks.”

According to the Brazilian Institute of Geography and Statistics, there has been a 29 percent growth in entrepreneurship among blacks from 2001 to 2011. However, it’s not all sunshine for Brazil’s new black middle class.

Black business owners still earn less than half as much as their white counterparts on average and face a number of other barriers to success. They have proportionately fewer years of education, are younger and have less access to resources like telephones and information technology. Black business owners also say it’s more difficult for them to get access to capital.

“Support for the Afro-Brazilian entrepreneur is very little,” says Fernandes. “We have great difficulty in opening physical spaces, getting loans at banks and so on.”

Afro-Brazilian businesses are also generally small. While the number of entrepreneurs has grown, of all the businesses owned by black Brazilians, just 8 percent employ more than just the owner. A higher percentage of the businesses are also in manual labor or industries like construction, agriculture and hairstyling.

‘Small world’ expanding

The new middle class is also facing a backlash from Brazil’s old guard. A 2012 survey by Brazilian research firm Data Popular found a variety of complaints.

According to the survey, 55.3 percent of wealthy consumers think that products should have different versions for rich and poor; 48.4 percent said that the quality of service has deteriorated with more access of the population; 49.7 percent prefer environments frequented by people of the same social level; and 26 percent say that a subway would bring “unwanted people” to the area where they live.

“For years, the elite bought and lived alone in their ‘small world,’” says Renato Meirelles, director of Data Popular. “In recent years, the middle class has ‘invaded’ malls, airports and other places where [previously] they had no access. As it is a new thing, the upper and upper middle class is still learning to live with it. Part of the elite is indeed bothered by this.”

But many experts believe that as more Afro-Brazilians become permanent fixtures of the middle class, these prejudices will become a thing of the past, not because of evolving humanity but out of financial necessity. Gillam, who has been visiting Brazil regularly since 2004, says that from what she has seen, black Brazilians are only going to make their presence more known in the future.

“I find that people are kind of relentless with pursuing any kind of avenue for putting forward black representation,” she says.

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