1. IMF reduces growth projections and Brazil has the worst GDP projection of major economies

This week, the International Monetary Fund (IMF) reduced its projection of GDP growth in 2022. Brazil’s GDP is projected to grow by 0.3%. However, three months ago, expectations were more optimistic, with a 1.5% growth projection. According to the IMF, the reduction is due to inflation and the attempt to control it through increased interest rates, “which will weigh on domestic demand.” Brazil’s growth projection is the worst among the world’s major economies. Even with reductions, the US and Mexico are expected to grow by 4% and 2.8% respectively this year. China is expected to grow by 4.8% and India by 9%.

Estadão: FMI corta projeção de crescimento do PIB do Brasil de 1,5% para 0,3% em 2022
CNN Brasil: FMI corta expectativa e projeta crescimento de 0,3% para o PIB do Brasil em 2022
G1: FMI corta projeções e vê alta perto de zero no PIB brasileiro este ano, no pior desempenho entre principais países

2. In order to join OECD, administration promises to lower tax on foreign exchange transactions to zero by 2029

The Brazilian government has promised to reduce taxes on financial transactions with foreign currencies to zero. According to Economy Minister Paulo Guedes, the measure aims to accelerate Brazil’s membership in the Organization for Economic Co-Operation and Development (OECD). It also aims to liberalize capital movement and invisible operations, which are part of the OECD’s economic goals for more transparency and international cooperation. Gaining membership in the OECD is one of the top foreign priorities for the Bolsonaro administration.

Folha de S. Paulo: Brasil promete zerar IOF sobre operações de câmbio até 2029 para entrar na OCDE
Valor Econômico: Brasil promete zerar IOF sobre câmbio até 2029 para entrar na OCDE
Poder 360: Guedes se adianta à OCDE e fala em zerar IOF sobre câmbio

3. MBL members join Podemos, increasing Sergio Moro’s support in São Paulo

This week, members of Movimento Brasil Livre (MBL) are expected to join the Podemos political party. This will mean former Operation Car Wash judge and former Justice Minister Sergio Moro will have greater support in São Paulo – a key state in the presidential race. MBL gained prominence as a center-right movement during protests demanding Dilma Rousseff’s impeachment in 2014. The group has its own political objectives, as this is the third election in which it will participate. Its plan is to have state representative Arthur do Val (Patriota) – known on YouTube as Mamãe Falei – run for state governor in 2022. Sergio Moro is supported by parties and politicians from the center-right. Since December, he has been trying to gather allies for his campaign.

Correio Braziliense: Moro confirma aproximação com MBL e fala a favor de fim da reeleição
Folha de S.Paulo: Filiação de integrantes do MBL ao Podemos dá palanque a Moro em SP
UOL: Moro chama membros do MBL de ‘pessoas boas’ e admite aproximação com grupo

4. Brazil drops two positions in corruption perception ranking, placing it 96th among 180 countries

According to a study by Transparency International, Brazil dropped two positions in the world ranking of corruption perception. Last year, among the 180 countries assessed, Brazil placed 96th in the Corruption Perception Index. Countries placed higher in the ranking are considered the least corrupt. On a scale of 0 to 100 points, Brazil scored 38, placing below the global average (43 point), Latin America and Caribbean countries (41 points), and G20 countries (66 points). Transparency International says Brazil is “stuck on a really bad plateau when it comes to corruption perception in the public sector.” The institution also says that actions by the Federal Government, Congress, and the Judicial branch have “led to setbacks in the institutional anti-corruption legal framework of the country.”

O Globo: Brasil cai em ranking mundial de percepção de corrupção e ocupa 96º lugar
G1: Brasil piora duas posições em ranking de corrupção
UOL: Brasil cai para 96º em ranking mundial de percepção da corrupção

5. The date of the National Census was confirmed

This week, the Central Bank said that foreign investments made directly in the Brazilian economy reached US $46.441 billion in 2021. This represents a 22.9% increase in comparison to 2020, when foreign investment reached US $37.786 billion. The Central Bank expected the amount to reach US $52 billion. Therefore, results were below expectations. In 2021, Brazil also registered a deficit of US $28.11 billion, meaning the difference between how much the country spent and what it received through international transactions related to trade, income, and unilateral transfers resulted in a negative balance.

Valor Econômico: Brasil fecha 2021 com déficit de US$ 28 bi nas contas externas e US$ 46,4 bi em investimento direto
O Globo: Investimento estrangeiro no país foi de US$ 46,4 bilhões em 2021, abaixo do projetado pelo Banco Central
CNN Business Brasil: Com US$ 46,4 bi, investimento estrangeiro no Brasil avança 23% em 2021 ante 2020