March 6, 2020
1. Growth slows, GDP ends year at +1.1%
Brazil’s Gross Domestic Product (GDP) grew below expectations, ending 2019 – the first year of the Bolsonaro administration – at 1.1%. This figure represents the slowest growth rate of the past three years and is less than half of the 2.55% that economists had projected prior to Bolsonaro’s inauguration. Specialists blame the drop in government spending, a drop in exports and imports, lower growth of consumption and a lack of investments for the slowdown. Expectations for the first quarter of 2020 are not positive. Concerns over coronavirus have left the entire world under a cloud of uncertainty and the weak economic performance in the first few months of the year has placed the expectation for GDP growth at just 0.4%. In 2020, economists expect 2.17% growth, according to a study by the Central Bank published on Monday.
Valor Econômico: Investimento em queda explica pibinho de 2019
Folha de S.Paulo: PIB cresce apenas 1,1% em 2019
Folha de S.Paulo: Não vamos mais falar com a imprensa, diz Bolsonaro
2. Amidst uncertainty, dollar hits record high at R$ 4.66
The Brazilian financial market is in turmoil since the presence of the coronavirus in the country was confirmed. The devaluing of the Brazilian Real in comparison to the U.S. dollar hit a record high, with the price of the dollar at R$ 4.66. Despite interventions by the central bank – three on Thursday alone – the administration only managed to reduce the devaluation to R$ 4.65, which cost the government USD $3 billion. The central bank signaled that it could reduce the basic interest rate in Brazil even though the Brazilian currency is one of the most devalued in the world. According to analysts, investors are sceptical. Economy Minister Paulo Guedes said that he does not believe there will be any capital flight. According to him, Brazil has a floating exchange rate that fluctuates to extremes due to changes in policies leading to low interest rates and increased fiscal control, consequently resulting in the present instability. “If I do a lot of stupid things, the dollar would hit R$ 5. If I do a lot of things right, it might drop,” he said.
3. Coronavirus spreads across Brazil and puts authorities on alert
The Brazilian government has released daily updates on the number of coronavirus cases and the number of people suspected of being contaminated. By early afternoon today, there were nine confirmed cases. Across the country, nearly 700 people have been tested for the virus and are suspected of having the disease. Even though the virus has a high rate of transmission, scientists consider its lethality to be low and say that there is no reason for panic. The confirmation that the coronavirus is present on every continent is worrying due to concerns about the effectiveness of the global response to the disease. The virus was identified in China at the end of 2019 and has already reached 79 countries, causing over 3,200 deaths, according to the World Health Organization.
4. Em pesquisa, eleitores querem mudanças políticas radicais
Pesquisa do Instituto Travessia feita para o jornal Valor Econômico mostra que o eleitor brasileiro demonstra interesse em renovação política nas eleições deste ano. Conforme o levantamento, 76% dos entrevistados gostariam de votar em candidato a prefeito de fora da política, com perfil outsider, e que não pertença ao grupo político do atual governante. A intenção de renovar o ambiente político é maior entre as mulheres, de acordo com o levantamento. Para 58% delas, a intenção é a de votar em outsider para comandar a prefeitura de sua cidade. Entre os homens, o índice é de 44%. O mesmo interesse em renovação é demonstrado quando a pergunta é sobre a votação para eleger o vereador do município, uma vez que 41% gostariam de trocar todos os vereadores que hoje atuam nas Câmaras. Para 32% dos eleitores, trocar a metade dos parlamentares já estaria de bom de tamanho. Na soma, 73% manifestaram desejo de mudança.
5. Administration hires retired public servants to deal with taxpayers
The federal government has decided to temporarily hire retired public servants in order to reduce the lines and the waiting times at agencies that deal with taxpayers. A provisional measure was published this week authorizing the hiring. Anyone hired by the administration will continue to be paid either based on productivity or with a fixed salary (30% of the income of those who are not retired). It is not necessary to do a public test to be hired and the new rule can also be applied in emergency situations, for example.