RIO DE JANEIRO, BRAZIL – In a presidential message formally delivered to the National Congress, the government of President Jair Bolsonaro stated that the Gross Domestic Product (GDP) should register a growth of about 5% in 2021 but presented a challenging scenario that could compromise the economy’s advance in 2022.
“Since the second half of 2020, the economic recovery proved to be solid, and in the first quarters of 2021, growth showed a persistent and integrated march in all sectors. Maintained this pace, the country’s Gross Domestic Product (GDP) should register an expansion of about 5% in 2021, which came to compensate, to some extent, the previous fall of 3.9%, bringing conditions to provide sustainability in the trajectory of the following years,” says the document.
For 2022, the “fiscal risk is a relevant element.” In the economic policy chapter of the message, the government presents a projection for the Brazilian economy in 2022 with negative and positive elements. “Among the negatives, the signaling of tighter global and domestic financial conditions, accompanied by eventual episodes of rising risk premiums, may act to discourage economic activity.”
Among the positive elements, the Executive cited the recovery of the labor market and service sector, the positive performance of agribusiness, and the normalization of the economy with the cooling of the covid-19 pandemic. “However, it highlighted that, to promote sustainable and inclusive growth of the economy, it is essential to persevere structural reforms and necessary adjustments in the Brazilian economy.”