The Brazilian economy is expected to grow faster than the world average in 2021 and 2022. UN Data released on Monday reveals that despite the resumption of GDP expansion in 2021, performance will not be able to keep pace with the global economy.
The forecast was released on the first day of the World Economic Forum, which is taking place almost this year. One of the speakers Paulo Quitus, Jair Bolzano is the government’s economic minister and who is trying to show businesses around the world that the country is looking for ways to overcome the crisis.
According to the UN, world GDP is projected to grow by 4.3% by 2020 and by 4.21% by 2021. By 2022, growth is losing some strength. But it should still be 3.4%.
As for Brazil, after a 5.3% contraction in 2020, the country will expand to 3.2% in 2021 and 2.2% in 2022, the last year of the Bolsanaro government. In other words, the results of the world economy are below average.
The Brazilian rate will be below the recorded expansion in developing countries or Latin American economies. In the region, the expansion will be 3.8% in 2021 and 2.6% in 2022. In developing countries, overall, expansion will be even stronger. In 2021, the forecast rate was 5.7% and in 2022 it was 4.6%.
In general, the UN fears that the Latin American continent will enter another long cycle of stagnation. “While Latin America and the Caribbean are expected to recover moderately in 2021 and 2022, the risk of another decade lost – in terms of economic growth and development – is approaching enormously,” the UN said.
“Judging from the experience of previous crises, there is likely to be significant long-term damage to production. Prolonged closure of schools, challenges associated with distance learning activities and the persistence of high unemployment rates are expected to have a negative impact on human capital,” the company estimates.
“This could exacerbate capacity shortages, which have been a major obstacle in many countries. In addition, corporate and public investment will be hampered by uncertainties, risky domestic demand and financial integration requirements, which could even hinder innovation and productivity growth,” he warned.
“In this context, the increasingly fragmented and uncertain global trade environment is likely to create external winds that are detrimental to exports and growth,” he adds.
According to the UN, the epidemic has “affected” Latin America and the Caribbean, causing severe human casualties and deep economic losses.
“Although most countries are implementing drastic and precautionary measures, the region has become a hotbed of epidemics and is now one of the highest per capita mortality rates in the world,” the UN said.
“The health crisis has been accompanied by a recession of historic proportions, which has been going on with disappointing growth for many years,” he said. “Real GDP is projected to decline by 8% by 2020 because long-term national locks, weak commodity exports and declining tourism have slowed economic activity,” he said.
Amid a sharp contraction in employment, an estimated 45 million people in the region have been pushed into poverty, erasing all the progress made over the past 15 years. ?
“The epidemic has disrupted economic activity in Latin America and the Caribbean, at a time when many countries are already struggling with serious economic problems,” the UN said. “Stagnant growth, weak investment and limited economic policy space have made the region vulnerable to global shock,” he concluded.