The Covid-19 Pandemic and the Economic-Industrial Health Complex in Brazil:

Technological Dependence in the Current Pattern of Capital Reproduction

Abstract

The COVID-19 pandemic was the biggest health emergency of this century, and its effects were felt differently in each part of the world. The case of Brazil was emblematic because, in addition to being led by the far-right government of Jair Bolsonaro (2019–2022), which was not particularly committed to saving lives, the lack of its own vaccine and the shortage of medical and hospital equipment to deal with the disease contributed to the pandemic disaster. The insufficiency of these items is the result of structural weakness in the health sector, which is reflected in the growing fragility of the so-called Health Economic-Industrial Complex (CEIS), which since the 2010s has been suffering gradual spending cuts, as pointed out in the specialized literature. Although Brazil has a significant weight in the global market for health products, the country is heavily dependent on imports of technologies and goods in this segment, especially inputs essential for the manufacture of drugs and vaccines, such as Active Pharmaceutical Ingredients (APIs). Brazil's technological dependence is so severe that the country was unable to produce its own vaccines during the pandemic because it did not have the necessary inputs and did not have enough masks, personal protective equipment, and ventilators to deal with the situation. To give you an idea, in 2020, the consumption of equipment and materials for medical and dental use was estimated at R$ 33.3 billion, while the value of domestic production reached R$ 13.2 billion in 2019, demonstrating how domestic production is insufficient to supply the Brazilian market. Brazil is essentially dependent on imports of the most sophisticated and high-priced equipment, which increases the trade deficit for this type of product. In addition, the country has very low and declining production of IFA, so that more than 90% of the pharmaceutical sector's needs are met by imports. Given this, what we point out is that this dependence is structural in nature, shaping our productive structure, production relations, and productive forces to the dictates of the development of the productive forces of the central countries. In other words, capitalist dynamics and the dependency relationships inherent therein subject the productive structure of Latin American countries to the interests of large monopolistic capital in central countries, so that dependent economies are subordinated within the International Division of Labor. In this sense, this paper seeks to analyze how technological dependence in the area of health, reinforced by the current Pattern of Capital Reproduction (PCR) of productive specialization, and the structural-productive fragility of the CEIS impacted the disaster of the Covid-19 pandemic in Brazil. It starts from the premise that, under the current PRC, the structure of dependence deepens, in the sense of reproducing the unequal development of dependent economies by engendering premature deindustrialization and productive restructuring, as well as reinforcing the role of large foreign monopoly capital that holds the technological monopoly linked to health. Considering, furthermore, that the configurations of class struggle and the government at the head of the dependent state set the tone for the path to be followed, namely: to reinforce or combat dependence, thinking about the Brazilian pandemic catastrophe necessarily involves thinking about the bloc in power and the moment of class struggle. What this means is that the PRC, which has been exporting productive specialization since the mid-1980s, reinforces the exporting nature of dependent economies. but now as hierarchically organized regions from a broad productive standpoint, such that dependent countries are assigned the non-strategic stages of production, while the more sophisticated stages are carried out by the central countries. This affects the Brazilian pharmaceutical industry and the main research institutes linked to it, Butantan and Fiocruz, reinforcing technological dependence and making the country vulnerable to future health emergencies. Nevertheless, the General Law of Capitalist Accumulation, presented by Marx in chapter 23 of book I of Capital, points to the tendency toward organic accumulation of capital as the ultimate goal of the capitalist mode of production, which seeks to extract the highest possible productivity from all factors of production (land, labor, means of production) in order to maximize profit. It turns out that in Latin American dependent capitalism or sui generis capitalism, as discussed in Marxist Dependency Theory (MDT), the process of internal and external capital accumulation takes on some unique characteristics. Capitalists in the central countries appropriate the surplus value and surplus produced in the peripheral countries and transferred to them, and capitalists here, pressured by the transfer of value and as a mechanism to compensate for it, reinforce the exploitation of the workforce through the overexploitation of labor, which ultimately corresponds to the basis of dependent capitalism. Added to this is the unbridled dispute over the appropriation of extra surplus value in the race for extraordinary profits within the dynamics of inter- and intra-capitalist competition in the world economy. This means that in the face of intensifying international disputes between monopoly capitals, within a movement of capital concentration and centralization, technological innovations are indispensable for the race to appropriate the surplus value produced in dependent economies and transferred to the central countries. Our preliminary hypothesis suggests that technological dependence is reinforced by growing state disinvestment in science and technology and by the increasing fragility of the CEIS, especially since the 2010s. To test the validity of our hypothesis, we propose qualitative research through a literature review of TMD and quantitative research through a survey of primary sources on Brazilian deindustrialization and disinvestment in health, especially since 2010. As possible developments of this research, we suggest studying the Unified Health System (SUS), which is also part of the CEIS, during the Covid-19 pandemic under the Bolsonaro administration, looking specifically at the overexploitation of the workforce of health professionals who worked on the front lines.