The Columbia University professor and winner of the Nobel Prize in Economics in 2011, Joseph Stiglitz, said on Monday (20) that the interest rate in Brazil is “shocking” and equivalent to a “death penalty”.
The statements were made during the seminar “Strategies of Sustainable Development for the 21st Century”, promoted by BNDES.
“Your interest rate {in Brazil} is, in fact, shocking. A rate of 13.75%, or 8% real, is the kind of interest rate that will kill any economy. It is impressive that Brazil has survived this, which would be a death sentence,” he said.
He attributed the fact that the country has survived these interest rates to “state banks, such as the BNDES, which have done a lot with these interest rates, offering funds to production companies for long-term investments with lower interest rates.
For the economist, Brazil’s historically high-interest rates have imposed a “competitive disadvantage.
“The question is, where would you be if you had a more reasonable monetary policy? ” You would be in much higher economic growth,” said Stiglitz.
At the same BNDES event, the president of the Federation of Industries of the State of São Paulo (Fiesp), Josué Gomes da Silva, defined interest rates in Brazil as “pornographic”.
According to Silva, many want to associate the current level of the Selic with a “fiscal problem”.
For him, such justification “is inconceivable in a country with the wealth of Brazil, which has a gross debt of 72% or 73% of GDP and foreign exchange reserves of around 17% or 18% of GDP.