Brazil Turns Northeast for Next Decade’s Growth
Tendências Consultoria predicts Brazil’s economically fragile Northeast will be the nation’s fastest-growing region from 2025 to 2033.
This growth comes from planned investments in both the public and private sectors. Before the recession in 2014, the Northeast was already growing faster than the national average.
Meanwhile, the North and Central-West regions are also looking up. Investments and the agriculture industry will fuel this growth.
Yet, Lucas Assis, an economist at Tendências, warns this doesn’t mean a big drop in Brazil’s unequal regional growth.
The Southeast is different. Even though it will get more money in total, the impact will be less.
This is because the Southeast already has a large economy. Assis says the Southeast will continue to be the key driver of Brazil’s economy, but the Northeast will grow faster year by year.
Despite the good news, Assis adds that inequality among regions will likely stay for at least another decade.
Key investments in the Northeast include a big project by Petrobras. They will spend about $8 billion to expand a refinery in Ipojuca.
Stellantis Invests
Another company, Stellantis, will invest $1.5 billion to grow its supplier park in Goiana. Noxis Energy also plans to build a $830 million refinery in the Pecém Complex in Ceará.
Ecio Costa, a professor of economics, talks about the New PAC program. This program plans to invest nearly R$100 ($20) billion in the Northeast.
But Costa has concerns. He points out that past plans like this haven’t always worked out.
In Pernambuco, one of the Northeast states, road quality is a big issue. Costa believes projects like the Metropolitan Arch and upgrades to the BR-104 road will help.
However, challenges remain. Problems could include inefficiency in public projects, high loan rates, and rising costs. Global issues might also affect investment coming into Brazil.
Tendências expects Brazil to grow at an average of 2.5% from 2025 to 2033. This rate is okay but not as good as some years before 2014.
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