By Lise Alves, Senior Contributing Reporter
RIO DE JANEIRO, BRAZIL – Brazil’s Gross Domestic Product (GDP), grew by only 1.1 percent in 2018, according to the PIB Monitor, calculated by the Getulio Vargas Foundation (FGV). The result is the same as in 2017 and much lower than anticipated earlier that year.
“This result is disappointing when one considers that it occurred after two consecutive years of strong economic contraction and a growth with an upward trend in 2017,” says Claudio Considi, coordinator of the PIB-FGV (GDP-FGV).
According to him the economy became almost stagnant during the course of year. “The strong uncertainty that permeated the economy, especially the truck drivers’ strike and the electoral period, greatly influenced this result. It was a lost year,” concludes Considi.
The increase in GDP growth last year was mainly driven by the services sector, which expanded by 1.3 percent during the year. The industry and agriculture sectors also registered growth, but more moderate increases, by 0.4 percent and 0.6 percent, respectively.
Among the services, those highlights in 2018 were real estate, growth of 3.1 percent; retail, up by 2.1 percent; and transportation, increase of 2 percent. Among the industrial segments, electricity increased by 1.4 percent, processing by 1.3% percent and mineral extraction by 1.1 percent.
One of the most important segments, construction, however, fell by 2.4 percent last year.
On the demand side, the highlight was the gross formation of fixed capital, (investments), which grew by 3.7 percent in 2018.
Household consumption increased by 1.8 percent and government consumption, 0.2 percent. Exports increased by four percent, which was less than the 8.1 percent growth registered in imports.
The official GDP performance in 2018, measured by the government’s Brazilian Institute of Geography and Statistics (IBGE), should only be announced on February 28th.