海角大神

For two decades, Chile was the 鈥渢eacher鈥檚 pet鈥� of Latin America, the student who always brought home straight A鈥檚.

Economists gushed that the Andean country鈥檚 commitment to free-market policies and democratic reform made it a model for the developing world. And as Chileans enjoyed the trappings of a sustained average growth rate of more than 5 percent per year, poverty plummeted from 40 percent to 13.7 percent. But in the past year, Chile鈥檚 gold star has gone to its hulking neighbor to the east, Brazil.

The agricultural juggernaut just won its bid to host the 2014 World Cup and the 2016 Olympics; it discovered vast oil deposits that could turn it into a major oil exporter; it was one of the last countries to be pulled into the global economic crisis and one of the first to pull out.

To be sure, the so-called Chilean 鈥渕iracle鈥� that constructed the most solid economic foundation in Latin America still stands, and some of its slower growth today is merely a result of its own maturation. But Brazil is finally claiming new status in the region, and not just for its size.

鈥淲e always looked at Chile as something better than us,鈥� says Arthur Ituassu, a professor of international relations at the Pontif铆cia Universidade Cat贸lica in Rio de Janeiro. 鈥淭here is a growing sense in Brazil that we are now the major actor in South America.鈥�

Promise finally fulfilled

This is not the first time that Brazil has been heralded as the world鈥檚 rising star. In the late 1960s and early 鈥�70s, the country was growing at an average rate of 11 percent a year. But the oil shock of 1973 stifled that rise, and economic woes, conbined with political ones, characterized the 1980s and early 鈥�90s. While Chile was experiencing its 鈥済olden decade,鈥� Brazil struggled through its 鈥渓ost鈥� one.

Yet today, with more than a decade of stable institutions and sustained growth, Brazil is finally living up to its promise.

Foreign investment, for one, has poured in. Investors are drawn to everything from biofuels to soybeans. Between 1994 and 1998, Brazil attracted an average of $14 billion annually in foreign direct investment; in 2008 that figure skyrocketed to $45 billion, according to the United Nations鈥� Economic Commission on Latin America and the Caribbean, based in Santiago, Chile. By comparison, Chile brought in $16.7 billion in 2008.

Brazil鈥檚 economy is vulnerable, especially as its currency, the real, has surged against the dollar, threatening exports. But inflation is under control, foreign reserves have been built up, and it has diversified its commodities trade. The government has helped to break 19 million people out of poverty since President Luiz In谩cio Lula da Silva took office in 2003. His government raised minimum wages, augmented a conditional cash-transfer program, and helped create some 8 million formal jobs. Today, at 7.5 percent, the unemployment rate is below precrisis levels.

Chile more open than Brazil

Chile remains an economic stalwart. It also pulled out of the economic crisis solidly, using the windfall from copper exports saved during boom times. It maintains a strict fiscal policy and its 21 trade deals with 57 nations reflect an economy that is much more open than that of Brazil. It consistently ranks as the least corrupt government in Latin America and will this month become the 31st member of the Organization for Economic Cooperation and Development (OECD), a group of top developed nations.

鈥淚 would say our image in the region is extremely positive,鈥� says Juan Gabriel Vald茅s, the executive director of the government鈥檚 Chilean Image Foundation. 鈥淲e know that we are observed and studied.鈥�

Still, some in Chile are starting to grumble. While it averaged 8 percent growth from 1987-97, it now grows at about half that rate. Chile needs to regain its momentum, say critics, and work out kinks such as lost productivity and rigidity in labor laws.

鈥淐hile is like a B student today. It is not bad, but it is not brilliant,鈥� says Felipe Morand茅, dean of the economics department at the University of Chile and an adviser to Sebastian Pi帽era, the right-leaning candidate who won the second round of presidential elections on Sunday. Mr. Morande says part of Mr. Pi帽era鈥檚 appeal is voter faith that he can revive the economy.

But Brazil now overshadows Chile, especially with Lula, its wildly popular leader whom President Obama called 鈥渢he most popular politician on earth.鈥� Ricardo Ffrench-Davis, an economist and former central bank official, says Brazil looks so good partly because it used to look so bad. 鈥淭wo years ago, Brazil was growing much less than Chile,鈥� he says.

Both countries face challenges ahead; both need to improve education and bridge divides between rich and poor. But their recovery from the economic crisis, as well as the strong rebounds in other nations such as Peru, bodes well for the future of the region, says Carlos Furche, head of trade in Chile鈥檚 government.

And those in Chile say they welcome the success of Brazil, which they view not as a rival but as a boon: A growing Brazil buoys everybody.

鈥淭he importance of Brazil鈥檚 emergence,鈥� says Thomas Trebat, a Brazil expert at Columbia University in New York, 鈥渋s that it shows you that growth can occur in Latin America in more places than just Chile.鈥�