Small Business The Case of Brazil

This report by the South African Institute of International Affairs examines the development of small, medium, and micro enterprises (SMMEs) in Brazil, focusing on the role of SEBRAE as a model for public-private partnership. It contrasts the Brazilian approach—which emphasizes logistical support, training, and clear categorization over direct financing—with the strategies used in South Africa and Lesotho.

• The Brazilian government's strategy for SMME development is based on two interlinked pillars: the clear definition and categorization of different types of SMMEs and the creation of a dedicated SMME body, SEBRAE.
• Brazil categorizes businesses based on employment numbers, distinguishing between industrial and service operations. Micro enterprises are defined as industrial operations with up to 19 employees or services with up to 9; small enterprises have 20–99 industrial or 10–49 service employees; medium enterprises have 100–499 industrial or 50–99 service employees; and big enterprises exceed 499 industrial or 99 service employees.
• SEBRAE is a non-profit private institution and a public-private partnership funded by a 0.3% payroll contribution from all companies, totaling approximately $450 million annually. Unlike many development agencies, SEBRAE is not a financial institution and does not grant credit; instead, it focuses on training, entrepreneurial culture, and logistical support to foster a 'self-help' attitude.
• While SMMEs in Brazil account for 98% of industrial, commercial, and service operations and over 60% of employment, they contribute only about 20% to the total GDP, with large companies contributing approximately 80%.
• The report identifies a critical distinction between 'entrepreneurs' and 'survivalists' in Brazil. Survivalists are those forced into informal business by the need to survive, and they represent a massive sector with an estimated 9.5 million informal businesses and 14 million unregistered employees.
• In South Africa, SMMEs contribute between 39% and 42% of GDP (increasing to 52%–57% if survivalists are included) and account for 55–60% of employment. The report argues that South Africa has historically confused the welfare objective of supporting survivalists with the economic objective of promoting small business.
• In Lesotho, the SMME sector is estimated by the Lesotho Chamber of Commerce and Business to contribute about 43% of the country's GDP. Many of these enterprises are subsistence-level and are predominantly headed by women (approximately three-quarters).

APA

-1 (2005). Small Business The Case of Brazil. South African Institute of International Affairs. https://saiia.org.za/wp-content/uploads/2008/04/Best-Prac-No.5_Brazil.pdf

Chicago

-1. Small Business The Case of Brazil. South African Institute of International Affairs, 2005. https://saiia.org.za/wp-content/uploads/2008/04/Best-Prac-No.5_Brazil.pdf.

Wikipedia

{{cite report |last1=-1 |title=Small Business The Case of Brazil |publisher=South African Institute of International Affairs |date=2005 |url=https://saiia.org.za/wp-content/uploads/2008/04/Best-Prac-No.5_Brazil.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{12005small, author = {-1}, title = {{Small Business The Case of Brazil}}, institution = {South African Institute of International Affairs}, year = {2005}, url = {https://saiia.org.za/wp-content/uploads/2008/04/Best-Prac-No.5_Brazil.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }