(Synthesis)
Rio de Janeiro (awp / afp) – Brazil stagnated in 2014 with GDP increase of only 0.1%, while the seventh world economy faces adverse winds and is about to enter recession in 2015
The figure announced Friday by the Brazilian Institute of Geography and Statistics (IBGE), slightly above expectations. Central Bank expected a contraction of 0.1% and the majority of analysts predicted zero growth.
In Q4 2014, the Brazilian economy shrank by 0.2% compared to the last three months of 2013.
The industry sector most affected, contracted by 1.2% in 2014, while the agro-industrial sector grew by 0.4% and 0.7% of services, said the IBGE.
Brazil prepares to enter recession under the impact of the crisis and fiscal adjustment that attempts to implement the government to halt the drift of public accounts and to avoid a deterioration in the sovereign rating by international agencies.
The table Central Bank on a 0.5% contraction of the economy in 2015, with high inflation that eats household purchasing power and could end the year to 7.9%, well above the ceiling of the official tolerance level (6.5%) and the 4.5% target set by the government.
To fight against the inflation, the monetary authority has gradually recovered its key rate up to 12.75%, a level that weighs on activity and investment.
A LARGE disorder ‘
Even unemployment, which has stood at historically low levels in 2014, begins to increase (+ 0.6% to 5.9% in February).
The IBGE revised figures on the growth of previous years, holding a new methodology for the calculation of GDP, applying international standards recommended by the International Monetary Fund (IMF) and World Bank (WB).
The new series takes as reference year 2010, when Brazil had experienced spectacular growth of 7.6% (7.5% under the previous calculation). In 2011, the first Latin American economy grew by 3.9% (instead of 2.7%) in 2012 to 1.8% (against 1%) and in 2013 by 2.7% (against 2 5%).
“The questions are now to know how deep the recession will be in 2015, when Brazil does begin to recover, and how fast?” explains to AFP Robert Wood, Brazil analyst for the Economist Intelligence Unit (EIU).
“There was a large imbalance in recent years from a budgetary point of view, inflation and foreign exchange. He missed a foreign policy that boosts competitiveness, there was no international agreements to boost exports, “summarizes Allex Agostini, chief economist of the Brazilian ratings agency Austin Ratings.
He said” Brazil will not grow in 2015 and may experience a growth of 1 to 2% in 2016, before growing by around 2.5% in 2017. “
EXCEEDED BY INDIA
India, partner of Brazil in the club of emerging countries of Brics, which grows by an average of 7% per year, should also delight at this year’s South American giant 7th place global economy, says Mr. Agostini.
Brazil is the Brics countries that experienced the lowest growth in 2014, far behind China (+ 7.4%), South Africa ( 1.4%) and even Russia (+ 0.6%), however, affected by the crisis in Ukraine and Western sanctions.
But the emerging giant of Latin America was also lagging behind all countries in the region in 2014, with the exception of Venezuela. Chile grew 1.9%, Mexico 2.1%, Colombia 4.6% Peru 2.35%, Argentina 0.5%.
The new Minister Finance Joaquim Levy, is working to pass a painful fiscal adjustment. These behaviors convince a divided Parliament when he does not enjoy much sympathy in the ranks of the Workers Party (PT, left) in power.
The political context does not help. The country is immersed in the psychodrama of the vast corruption scandal that splashes the oil giant Petrobras state, the country’s largest construction companies and fifty politicians including the treasurer of the PT, and the presidents of both chambers.
President Dilma Rousseff, the lowest in the polls, is at the center of a sling which mobilized more than 1.7 million Brazilians against it in the streets on March 15, just five months after its short re-election as head of the country
afp / al
(AWP / 27.03.2015 5:11 p.m.).
(AWP / 17 27/03/2015 : 11) ^ ->
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