Brazilian Industry Back at Level Where Global Crisis Started

Sansuy plant, plastic factoryAccording to Brazil’s National Confederation of Industries (CNI), Brazilian industry revenues are growing in a consistent and sustainable manner and in December 2009, they exceeded by 0.2% the result recorded in September 2008, the month immediately before the worsening of the international financial crisis.

“Out of all the factors that we survey, this is the only one that has already overcome the pre-crisis period,” said the Economic Policy manager of the CNI, Flávio Castelo Branco, upon disclosing the Industrial Indicators bulletin on February 10.

Compared with December 2008, processing industry revenues increased by 12.2% and recorded growth in nine out of the 12 months in 2009. Economist Flávio Castelo Branco ascribes the positive figures to the increasingly heated domestic market.

Out of 19 sectors surveyed by the CNI, 15 recorded growth in revenues in December, compared with the same month of 2008. The highest rate of growth was that of basic metallurgy (47.6%), followed by rubber and plastic (32.4%) and metal products (29.7%). Using the same basis of comparison, chemical products industry revenues grew 29.6% and editing and printing industry revenues rose by 24.6%.

The machinery and equipment industry – which is used as a reference to indicate the industry’s trend of investing in expanding production – recorded a 6.9% increase in revenues, in the comparison between December 2009 and the same month of the previous year.

“However, the 0.2% increase in revenues posted by the industry is still low when compared with that of September 2008, when the crisis began affecting the industry,” said the economist.

In the comparison between the annual averages for 2009 and 2008, revenues have recorded the largest decline since the results started being kept track of, in 2003 (-4.3%), adds Castelo Branco. “But of course this is largely due to the fact that average revenues in 2008 were 5.4% compared with 2007,” he pondered.

Only four industries recorded a decline in revenues, in comparison with 2008: electronic and communication materials (-2.2%); refining and alcohol (-8.5%); wood (-14.6%) and clothing (-15.4%).

“These are exporting industries, or ones in which there is strong competition against imported products,” explains Castelo Branco. “In turn, the reduction in revenues of the refining and alcohol industry was due to the price reduction that has been taking place for some time now in the global market,” he added.

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