Brazil managed to preserve fiscal responsibility in 2021 after record spending in 2020 due to the covid-19 pandemic, Economy Minister Paulo Guedes said today (17). He participated in a meeting of finance ministers and presidents of Central Banks of the G20 (group of the 20 largest economies on the planet) through recorded video and said that several projections about the country were wrong.
“Our primary deficit fell from 10% of GDP [Produto Interno Bruto]in 2020, to 0.4% in 2021, the best level since 2014. Public debt [bruta], which pessimists said would reach 100% of GDP, is back to a manageable 80% in 2021. Public spending has fallen from 26% of GDP to 18.6%. These are achievements that few economies in the world have achieved. Pessimistic forecasts have been consistently proven wrong. We maintained solid fiscal foundations”, declared the minister.
Guedes also said that Brazil is prepared for growth. According to him, Brazilian GDP recovered rapidly in 2021, and the country became one of the nine G20 economies that recovered the level of production observed before the pandemic.
For Guedes, the recovery of the Brazilian economy in 2021 can be explained by “the high rate of the population fully vaccinated” against covid-19 and by the programs to preserve jobs. In the minister’s assessment, the measures were enough to create 3 million formal jobs last year and reduce the unemployment rate.
The minister said that Brazil began to withdraw stimulus last year, while continuing to pursue the reform agenda. Guedes mentioned other measures, such as the concession and privatization agenda, which, according to him, attracted a record volume of private investment in infrastructure. Other measures mentioned by him were the advancement of digital government and measures to reduce bureaucracy and improve the business environment.
Held in a hybrid way (in person and virtual), the meeting of finance ministers and presidents of G20 Central Banks ends tomorrow (18). The event discusses strategies for a gradual exit from the economic stimulus programs adopted in the pandemic. The director of International Affairs and Corporate Risk Management at the Central Bank, Fernanda Guardado, also participated in the meeting, via videoconference.
