Guedes team highlights V-shaped recovery

The 2021 GDP shows a “economic recovery in ‘V'”, according to the Ministry of the Economy.| Photo: Hoana Gonçalves/ME

The federal government’s economic team indicated this Friday (4) that the 4.6% growth in 2021 more than offsets the decline of the previous year (-3.9%), bringing the country back to the level of activity pre-Brazilian pandemic. and showing a “V-shaped economic recovery” – an expression used since 2020 by Minister Paulo Guedes in his forecasts on Gross Domestic Product (GDP).

In the note, the Secretariat for Economic Policy (SPE) of the Ministry of Economy warns of the need to “monitor the development of the international scenario due to the conflict in Eastern Europe” – the war of Russia versus Ukraine.

Besides the “diplomatic and humanitarian positions”, the SPE says that at this moment it is up to Brazil “to show that it is a safe haven for private investment”, maintaining the reform agenda and the privatization process .

For the secretariat, it is necessary to strengthen the capital and credit market, by approving the bills of the guarantee framework and the incentive debentures and the interim measure of the public records. “It would also be important to obtain legislative approval for the privatization of Correios and to proceed with the privatization of Eletrobras in the first half of the year,” he adds.

Commenting on the GDP data, Paulo Guedes’ team points out that the cumulative growth of 0.6% in 2020 and 2021 exceeds that of almost all members of the G-7 (a group that brings together some of the richest countries) , being only below the 2% advance in the United States. Within the G-20 (19 largest economies plus the European Union), Brazil’s growth in both years was the 9th highest.

Jobs and investment allow GDP to beat market expectations in 2022, says government

For 2022, the economic team says there is a “good prospect for private investment”, indicated by the production of capital goods and sounds with contractors and the expectation of disbursements of R$78 billion. in the Investment Partnership Program (IPP). The PES also expects the labor market to continue its recovery this year.

“The expected impact of the expansion of PPI projects for 2022 on investment will be R$38 billion, representing 2.3% more GFCF [Formação Bruta de Capital Fixo, que mede o investimento produtivo] and 0.4% more GDP, compared to the estimated values ​​for 2021,” the note said.

“The normalization of negative supply shocks, which may occur with the cooling of the pandemic, the restoration of global production chains, the reduction of hydrological risk, with positive impacts on the energy market, the advancement of the labor market and expanding private sector investments support an estimate of economic growth in 2022 higher than that currently projected by the market,” says the SPE.

The median of the projections collected by the BC Focus report points to a rise of just 0.3% in GDP in 2021, but the economics team insisted that the advance should be closer to its projection, which is 2.1%.

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