ABSTRACT
Introduction As Brazil prepared in early 1985 to welcome its first civilian government in 21 years, the 1984 Informatics Law seemed to guarantee a safe passage for SEI and the informatics policy through the turbulence of the transition to democracy. The democratically elected Congress had given the market reserve a solid legal basis for eight years, SEI had survived essentially intact, the main civilian political forces that had supported the new law were also the controlling forces of the new government, and the national computer industry was growing rapidly as it moved to occupy the supermini niche with foreign technology purchases. The new government was committed to strengthening the market reserve and the national industry, including new ventures into microelectronic components. The supporters of the policy had demonstrated a remarkable level of political agility to shepherd the policy through a constantly shifting political and economic environment from the most repressive period of the military regime through the successful transition to a civilian democracy. In the process, not only had the highly protectionist informatics policy been defended, but a quite substantial national informatics industry had been created, and that seemed to herald the possibility of the creation of a new variety of capitalism that would marginalize multinational companies across broad stretches of the Brazilian economy. The political and institutional future of the policy looked bright. Well before the expiration of the market reserve, however, the policy and its institutional framework would be in tatters, a victim of its own failure to create a more technologically dynamic national industry but also of the particular way in which both political democratization and economic liberalization occurred in Brazil. By the late 1980s, the issue would no longer be how to defend the market reserve but rather whether friends or foes of the policy would supervise its implosion. By the early 1990s, the market reserve would be officially abandoned in favor of opening the economy to imports (although accompanied by the imposition of fairly stiff tariffs and other preferential treatment for national companies) and near complete freedom to associate with multinational companies. This chapter will cover the first part of this third period of the trajectory of the informatics policy through the challenge to the policy mounted by the United States in the late 1980s. Chapter 6 will cover the last years of this third period as
the market reserve model was first revised and then abandoned. The next section provides the contextual discussion of the political and economic strategic universe for this entire third period detailed in this and the next chapter.
