Economic crisis in Brazil from 2014

Dilma Rousseff and Michel Temer in January 2015

A severe economic crisis has been shaking the economy of Brazil, a country of 200 million people, since around mid-2014, beginning during the reign of Dilma Rousseff .

The crisis was accompanied by a political crisis, which led to anti-government protests across the country. Dilma Rousseff, president at the time, was permanently removed from office due to an impeachment in August 2016, her successor Michel Temer promised on taking office to stimulate the economy again through various measures.

One of the symptoms of the crisis is the severe recession . It is considered to be the worst recession in the country's history with a decline in gross domestic product (GDP) for two consecutive years. The economy shrank by around 3.8% in 2015, in September 2016 the unemployment rate reached 11.8% with around 12 million Brazilians.

In 2016, the effects of the economic crisis were felt by the public and by the strain on public services that had to adjust to financial realities. According to surveys by the Confederação Nacional da Indústria (CNI), the national industrial association, in June 2016 of 2002 people in 141 cities, 48% of those surveyed are said to be unable to afford public transport , 34% not to be able to afford health insurance and 14% of parents to have their children from private schools switch to public schools. And further, 78% of respondents said they were buying similar cheaper products instead of expensive ones.

In June 2017, the one percent increase in GDP for the first quarter of the year was announced, the first increase after eight consecutive quarterly declines. The finance minister, Henrique Meirelles , said the country was "out of the deepest recession of the century" ( "saiu da maior recessão do século" ).

causes

Consumption Concentration

An important cause of the current crisis is the previous decision by the government to boost domestic consumption in particular. As a result, economic weakness immediately hits the economy as a whole and exports cannot cushion the slump in the home market.

Commodity prices

The sharp drop in raw material prices in 2014/15 caused one of the country's lesser export areas to collapse. Above all, the important trading partner People's Republic of China bought significantly fewer raw materials in Brazil, which is why exports collapsed by 12% in 2014 alone.

course

Economic growth in Brazil has been declining since 2010, but in 2010 it marked a very high record with growth of 7.6%. By 2013 it finally fell to a moderate value of 2.7%. In the year of the soccer World Cup, despite the many World Cup visitors, there was a small growth of only 0.1%, without the World Cup the country would have slipped into recession this year. For the following year, 2015, the International Monetary Fund (IMF) reported a 3.0% slump in the economy, which will continue in the following year at 1.0%.

As a result of this massive slump, the budget deficit also rose from −3.1% in 2013 to −7.7% in 2015. According to the IMF, the deficit is to remain at a high level, over 3%, until 2020.

See also

• Brazilian crisis

Individual evidence

1. ↑ Graziele Oliveira, Marcos Coronato: Como o Brasil entrou, sozinho, na pior crise da história. In: Época . April 4, 2016, Retrieved July 7, 2017 (Portuguese). 
2. ↑ Brasil vive a pior recessão da história. (News program, video, 9 min) In: O Globo G1. July 3, 2017. Retrieved July 7, 2017 (Portuguese). 
3. ↑ Investimentos despencam e PIB cai 3.8% em 2015, na maior recessão desde 1990. In: Estadão . March 3, 2016, accessed on July 7, 2017 (Portuguese, payment barrier).  
4. ↑ Nicola Pamplona: Desemprego sobe a 11.8% e atinge 12 milhões de pessoas, indica IBGE. In: Folha de S. Paulo . September 30, 2016. Retrieved July 7, 2017 (Portuguese).  
5. ↑ Eliane Oliveira: Recessão gera mudanças de hábitos de consumo na população. In: O Globo . August 25, 2016. Retrieved July 7, 2017 (Portuguese). 
6. ↑ Com crise, brasileiros estão usando mais serviços públicos, diz CNI. In: O Globo G1. August 25, 2016. Retrieved July 7, 2017 (Portuguese). 
7. ↑ Taís Laporta, Daniel Silveira: PIB do Brasil cresce 1% no 1º trimestre de 2017, após 8 quedas seguidas. In: O Globo G1. June 1, 2017. Retrieved July 7, 2017 (Portuguese). 
8. ^ Daniela Amorim, Fernanda Nunes, Vinicius Neder: PIB sobe 1% no 1º trimestre, após oito quedas consecutivas. In: Estadão . June 1, 2017. Retrieved July 7, 2017 (Portuguese). 
9. ↑ Brazilian total crisis  ( page no longer available , search in web archives )  Info: The link was automatically marked as defective. Please check the link according to the instructions and then remove this notice.  
10. ↑ IMF DataMapper