As emerging markets continue to grow and grab market share, a strong higher education system will be vital to their success.  As a result, several major Brazilian companies have decided to build their own education systems, adding value to their companies and the exchange traded funds (ETFs) that hold them.

The quality of Brazil’s universities are far from being superior and can’t compete with those of the other emerging markets in East Asia and Eastern Europe. Despite being one of the most populous countries in the world, they fail to have a university ranking in the top 100 worldwide and this system doesn’t churn out enough graduates with technical skills.

This limits Brazil’s competitiveness by limiting its ability to utilize and gain knowledge and leads to a lack of skilled workers.  To make up for this shortfall, companies like Vale, Embraer, and Amanco have decided to ameliorate the situation by providing educational tools themselves, states Joshua Partlow for the Washington Post.

Vale has gone as far as opening its own universities and it teaching and training roughly 7,000 students in graduate level engineering, geology and technical courses.  In addition, they pay their students a salary, offer health care benefits, and offer lodging accommodations for some. Embraer has alliances with several Brazilian universities, urging them to focus on engineering and technical studies and even opened an educational headquarters in Sao Paulo. Amanco has launched a program to teach and train in construction technique at 56 of its stores and boasts that it has graduated about 26,000 students.

Despite the declining global demand for minerals, the financial crisis, and the overall well being of the global economy, Brazilian companies are confident that growth will be in the future and are devoted to making an investment in their future employees who will enable these companies to be competitive and thrive in a global marketplace.

iShares MSCI Brazil Index Fund (EWZ): down 58.4% year-to-date. Vale is 9.4%.

Tags: Brazil, Emerging Markets, EWZ, Latin America