May 7, 2021


1. COVID-19 investigators reveal Bolsonaro administration’s failures in the fight against the pandemic

During his deposition to the COVID-19 CPI (Parliamentary Inquiry Committee) on Thursday, Health Minister Marcelo Queiroga was unable to confirm how many doses of the coronavirus vaccine the federal government has actually purchased. Both official government messaging and Queiroga himself claim that 560 million doses will be delivered by the end of the year, but the accuracy of this number is being questioned. In his deposition, the minister shared a lower figure – 430 million – but in prior questioning by the CPI, he had said 280 million doses. With this deadlock and the suspicion that the numbers have been inflated, Queiroga will have to show the data to the CPI. In many Brazilian cities, there are not enough vaccines for first or second doses.

This week, the CPI – the investigation into the work of the federal government in the fight against the pandemic and how states and cities used public funds for this purpose – has revealed the many shortcomings of the federal government, such as failing to plan vaccine purchases and insisting on the use of hydroxychloroquine as a preventive treatment. The CPI has also heard from former Health Ministers Luiz Henrique Mandetta and Nelson Teich. General Eduardo Pazuello – another former Health Minister being targeted by the investigation – did not show up, claiming that he had been in contact with people who have tested positive for the coronavirus. His deposition has been scheduled for May 19th.

Folha de S.Paulo: Ministro poupa presidente
O Estado de S. Paulo: Ministro infla dados sobre vacinas
Folha de S.Paulo: Ex-ministro alega quarentena e não depõe
G1: Cidades interrompem vacinação por falta de doses

2. Under pressure, Bolsonaro gives speech criticizing China, threatens supreme court

Facing pressure due to the revelations from the COVID CPI, President Jair Bolsonaro made thinly veiled criticisms of China and the independence of the Federal Supreme Court. “It is a new virus. No one knows if it was born in a lab or created by a human. The military knows what nuclear, biological and chemical warfare is. What is the country that had the largest GDP growth? I’m not gonna tell you,” stated the president during an event at his residence. Later, he said that he did not mention “China” in his speech, the country that experienced the largest GDP growth during the pandemic and which supplies key ingredients for the vaccines. Yesterday, a representative of the Chinese government said that China is opposed to using the virus politically.

Bolsonaro also questioned restrictions imposed by city and state governments. “If I sign a decree [forbidding lockdown measures], it will have to be respected. Don’t they dare contest it,” said the president. Exceptional measures implemented during the pandemic – and Brazil’s constitution – forbid the president from interfering in the autonomy of states and cities unless such actions are approved by Congress. On Wednesday, Brazil completed 50 consecutive days with a daily average number of deaths at over 2,000 per day. More than 417,000 people have died, and 15 million people have been diagnosed with the virus, while just 11% of the population have received both doses of the vaccine.

Folha de S.Paulo: Sob pressão, presidente ataca a China e o STF
Folha de S.Paulo: China condena politização do vírus
G1: Leia mais notícias sobre a pandemia
Folha de S.Paulo: Veja como está a vacinação no país

3. Basic interest rate increases to 3.5%, maintaining upward trend

The basic interest rate in Brazil increased by 0.75%, for an annual rate 3.5%. The Central Bank also indicated that there will be further increases following the next meeting with the Monetary Policy Committee (COPOM) on June 15th and 16th. In a statement about the increase, the Central Bank confirmed that it considers the current inflationary shocks “temporary.” “With the exception of oil, international commodity prices continue to rise, affecting price projections for food items and industrial goods,” read the statement, also highlighting the changes in the tariff flag “that could keep the inflation under pressure in the short term.”

COPOM admitted that the monetary policy is aimed at the 2022 inflation rate, with a target of 3.5% inflation and a tolerance of 1.5%. This year, the announced goal was 3.75%, with a possible variation of between 2.25% to 5.25%. According to the COPOM’s statement, even with the worsening of the pandemic over the past few months, there are signs of economic recovery. “When it comes to Brazilian economic activity, recent indices show a more positive result than expected […]. The uncertainty in the growth rhythm for the economy is still above the average, but little by little it should return to normal,” it read.

Valor Econômico: Copom eleva taxa Selic para 3,5%
Folha de S.Paulo: Taxa pode chegar a 4,25% em junho

4. Micro and small enterprises contributed to 57.9% of total job growth in March

Micro and small enterprises (MSEs) were responsible for 57.9% of total job growth in March, a study by Sebrae based on the General Registry of Employees and Unemployed people shows. Out of the 184,140 formal jobs available, 106,796 were at small companies. It was the ninth consecutive month with an increase in hires. In the accumulated rate for the year, MSEs were responsible for 70.1% of the nearly 837,000 jobs created in the first quarter of the year, compared to 22.7% in medium and large companies.

When looking at data by sector, the study shows good results in every sector, but the service sector was ahead in the number of jobs created in March: 38,884 by MSEs in comparison to 55,873 created by medium and large companies. The transformation industry follows micro and small companies in job creation rankings with 27,759 new jobs, followed by the civil construction sector with 18,386. The average for micro and small companies was 195,000 total jobs over Q1, more than triple what larger companies have hired at 63,000. Brazil has over 14.4 million people currently unemployed.

O Estado de S. Paulo: Micro e pequenas empresas abrem mais vagas

5. Industrial sector loses gains made over the past nine months

Brazilian industrial production dropped 2.4% in March, annulling the 40.1% gain accumulated over nine consecutive months of growth, which included a return to pre-pandemic production levels (February 2020 results). According to a Monthly Industrial Study, 15 of the 26 sectors analyzed registered a drop in production. Vehicle manufacture production, for example, dropped by 8.4%. According to economists, car manufacturers faced a halt in production due to a shortage in parts and equipment. The worsening of the pandemic is the reason for the drop in Brazilian production.

However, results are positive in comparison to 2020. In March this year, industrial production increased by 10.5% in comparison to March 2020. This can be seen in 20 of the 26 sectors analyzed. However, compared to the period before the coronavirus – March 2019 – there has been a drop of 3.9%. In the accumulated data for the quarter, there was a 0.4% drop compared to the last quarter and a 4.4% increase compared to same period of 2020.

Valor Econômico: Indústria perde ganhos de 9 meses
O Estado de S. Paulo: Produção industrial cai com avanço da pandemia