The industrial sector, composed of three groups – manufacturing, construction, and mining -, which registered 6% growth this year, is expected to grow at a slower pace in 2005, an average of 4.5%.
This forecast was made by the president of the National Confederation of Industry (CNI), Federal Deputy Armando Monteiro Neto, at the launching of the document “Brazilian Economy: Performance and Prospects.”
He informed that the slight retraction can be explained by the less favorable situation abroad, as a result of the disequilibrium in the American economy, beset by fiscal and foreign debts, and the adjustment in the pace of external expansion, affected by the monetary policy based on controlling inflation.
Monteiro attributed the good performance of the industrial sector this year to the recovery of domestic consumer demand, due to the control of inflation, salary recovery, and the revival of the job market.
The president of the CNI acknowledged that another important factor in the recovery of industrial sales was the 30% export growth registered this year.
He attributes this result to the flexible exchange policy in recent years, guaranteeing a competitive exchange rate.
Monteiro said that a reduction in exports is foreseeable, but he added that, even so, the country will continue to grow.
“The CNI’s forecasts bet on a 3.5% growth rate, but, in order to continue moving in the direction of economic development, Brazil needs to conclude the tax reform, improve credit conditions, alter the labor laws, and expand investments in the area of infrastructure,” he contended.
Translation: David Silberstein