The external accounts had a negative balance of US$ 5.9 billion in December, informed the Central Bank (BC) today (26). In the last month of 2020, the deficit was US$ 8.5 billion in current transactions, which are the purchases and sales of goods and services and income transfers with other countries.
As a result, Brazil ended 2021 with a deficit of US$ 28.1 billion in current transactions, which represents 1.75% of the Gross Domestic Product (GDP), compared to US$ 24.5 billion (1.69% of the GDP) in 2020.
The BC said that the increase in the deficit, of US$ 3.6 billion, was due to the expansion of US$ 12.2 billion in the primary income deficit, partially offset by increases of US$ 3.8 billion in the trade surplus. and a US$ 1 billion surplus in secondary income and a reduction of US$ 3.8 billion in the deficit in services.
Also according to the Central Bank, Direct Investment in the Country (IDP) registered a net outflow of US$ 3.935 billion in December. In the same month of 2020, there was a net inflow of US$ 1.1 billion. The BC estimate for the month was net inflows of US$ 3 billion.
The bank said equity participation, such as buying new companies and reinvesting profits, was negative by $2.3 billion. While intercompany operations (such as loans from the parent company abroad to the branch in Brazil) recorded net outflows of US$ 1.6 billion in the month.
In 2021, the IDP totaled net inflows of US$46.4 billion (2.89% of GDP), compared to US$37.8 billion (2.61% of GDP) in 2020.
When the country registers a negative balance in current transactions, it needs to cover the deficit with investments or loans abroad. The best way to finance the negative balance is the IDP, because the resources are invested in the productive sector and are usually long-term investments.
Thus, the 2021 result of the PDI is sufficient to cover the current account deficit of 1.75% of the product in 12 months.
Trade balance and services
The trade balance for goods had a surplus of US$ 2.7 billion in the month of calculation, compared to a deficit of US$ 1.9 billion in December 2020. Exports of goods totaled US$ 24.6 billion and imports of goods, US$21.9 billion, increases of 32.2% and 6.7% compared to December 2020.
Imports under Repetro (special customs regime) totaled US$ 222 million in December 2021, compared to US$ 3.8 billion in December 2020.
In 2021, exports totaled US$ 283.3 billion, an increase of 34.7% compared to the US$ 210.7 billion observed in 2020. Imports totaled US$ 247.6 billion, an increase of 38.9% compared to to the US$ 178.3 billion observed in 2020.
Repetro is the special customs regime that suspends the collection of federal taxes on exports and imports of goods intended for exploration and mining activities in oil and natural gas deposits, mainly exploration platforms.
The deficit in the services account (international travel, transportation, equipment rental and insurance, among others) totaled US$ 1.9 billion in December 2021, an increase of 11.7% compared to December 2020.
The international travel account recorded net expenses of US$413 million, compared to US$74 million in December 2020. Equipment rental recorded net expenses of US$640 million, a decrease of 31.9% compared to December 2020.
The transport account recorded net expenses of US$ 541 million, compared to US$ 310 million in December 2020, following the trend of expansion of the foreign trade flow. In 2021, the deficit in services totaled US$ 17.1 billion, a reduction of 18.3% compared to the deficit in 2020, US$ 20.9 billion.
The decrease of US$ 3.8 billion was mainly due to the reduction in net expenses with equipment rental (US$ 5.1 billion, contraction of 42.6%), influenced by the nationalization of equipment within the scope of Repetro.
Direct investments abroad (FDI) showed net disinvestments of US$ 3.9 billion in December 2021, compared to net investments of US$ 1.1 billion in December 2020.
In 2021, FDI flows totaled net investments of US$ 19.2 billion, compared to net disinvestments of US$ 3.5 billion in 2020. The result was mainly due to investments in equity, which totaled US$ 19.3 billion in 2021, compared to net divestments of US$ 4.8 billion in 2020.
rents
In December 2021, the deficit in primary income (profits and dividends, interest payments and salaries) reached US$6.9 billion, up 37.6% from US$5 billion in the same month of 2020.
Normally, this account is in deficit, since there are more investments by foreigners in Brazil, who remit profits abroad, than by Brazilians abroad.
Net income and dividend expenses, associated with direct and portfolio investments, totaled US$4.6 billion, up 105% from December 2020. Net interest expenses totaled US$2.4 billion, compared to US$ $2.8 billion as of December 2020.
In 2021, the deficit in primary income totaled US$ 50.5 billion, 31.9% above the deficit of US$ 38.3 billion in 2020. Net expenses with profits and dividends totaled US$ 29.8 billion in 2021, 77.4% higher than the value observed in 2020, while net interest expenses totaled US$ 20.7 billion, slightly lower than the US$ 21.6 billion in 2020.
In December, the stock of international reserves totaled US$ 362.2 billion, a decrease of US$ 5.6 billion compared to November 2021. The result was mainly due to the liquidation of US$ 4.8 billion in sales cash and US$ 1.5 billion in net concession in repurchase lines. In the year, international reserves grew by US$ 6.6 billion.
