ABSTRACT
This chapter analyses the real side of the regional question in Brazil in the import substitution model. However, as it is almost impossible to disentangle the real and financial spheres of a monetary economy, constant reference will be made to the financial elements of this economy. Although there were some movements towards industrialisation in Brazil since the second half of the XIX century, they were mostly restricted to traditional industries, and these industries were only appendices to the staple producer sector that had its dynamic determined by the conditions of the external markets from which all the dynamism of the economy was derived. The idea of the regional economies forming a semi-isolated "archipelago", in Brazil, was largely acceptable until the beginning of the XX century. In the 1920s, however, this situation began to change and opened up a new phase for economic relations between the regions.
