Electronics Industry in Brazil Predicts Gloomy 2016

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – The industrial production of electro-electronic products in Brazil faced a difficult year in 2015, falling by at least twenty percent in relation to 2014, according to data from ABINEE (Brazilian Electric Electronic Industry Association). The entity forecasts a similar gloomy scenario for this year, with the end of the fiscal benefits given by the government to computers, tablets and smart phones.

On December 31st, 2015, it was announced that Brazil’s President, Dilma Rousseff, had vetoed parts of a bill in Congress which maintained the fiscal benefits for these electronic equipment.

The fiscal benefit was given as part of the government’s Digital Inclusion Program. With the President’s veto and the end of the fiscal benefits, analysts predict that the prices of smart phones, computers and tablets will automatically increase by at least ten percent in 2016.

According to Humberto Barbato, president of ABINEE the President’s decision may reflect in the reduction of access to technology for the lower income population in Brazil. “The end of the Digital Inclusion Program is a step backwards for the country,” said Barbato in a press release.

For Barbato, the increase in taxes and the consequent decline in production are expected to lead to nearly four thousand lay-offs in the sector’s industries. The electro-electronic industries in Brazil closed 2015 with revenues of R$148 billion, volume four percent below that registered in 2014.

According to data from ABINEE the sector reduced the number of jobs in the industry by thirteen percent during the past twelve months.