By Richard Mann, Contributing Reporter
RIO DE JANEIRO, BRAZIL – Brazilian executives and entrepreneurs are getting increasingly worried about the economy. At an event which gathered 450 businesspeople and government heavy-hitters like Economy Minister Paulo Guedes in Campos do Jordão last week, concerns about the slow pace of recovery were prevalent in conversations. Additionally, business confidence has reached its lowest level since October, according to a survey from Fundação Getúlio Vargas.
Their current mood contrasts with the optimism at beginning of the year, when the start of a new administration fueled hope for an economic rebound.
But Bolsonaro’s first 100 days in office have been anything but smooth. The government’s failure to forge a working majority in Congress and frequent sidetracking into controversial topics has slowed progress, including in the overhauling of the pension system.
As a result, traders have opted to pare back on some of their optimistic bets, and foreign investors have mostly stayed on the sidelines.
While most businesspeople refrain from openly discussing politics, some are speaking out.
“What keeps us up at night is that this belligerent group in the government does not seem to have switched from campaign mode to governing mode,” retail magnate Flavio Rocha, who mulled a presidential run himself, said during the event. “That’s the biggest threat to the reform.”
The disappointing pace of the economy and still-cloudy outlook has some companies that depend on the domestic economy keeping their planned investments in check.
Retail giants like Magazine Luiza SA and Carrefour Brasil are either leaving their forecast investments on the same level as 2018 or expecting only slight increases.