Brazil’s Growth Recipe: Exports Up and Inflation Down

Brazil’s Institute of Applied Economic Policy (Ipea) released its Conjunctural Bulletin #68, with revised forecasts for growth in this year’s GDP (Gross Domestic Product).

According to the economist Paulo Levy, Ipea’s director of Macro-Economic Studies, the increase should come to 3.5%, down from the 3.8% predicted in the previous forecast.

With regard to this year’s export volume, on the other hand, the Ipea doubled its growth forecast from 5.1% to 10.2%, in consequence of the dynamism demonstrated by shipments of products abroad.

The institute’s growth forecast for imports was also revised upwards, from 13.8% to 18.9%. The projected trade surplus for this year was raised US$ 3 billion, from US$ 24.7 billion to US$ 27.7 billion, Levy said.

Levy pointed out that the projected trade surplus is lower than the US$ 33.6 billion achieved in 2004.

Monetary Policy

Meanwhile, Minister of Finance, Antônio Palocci, assured that Brazil’s monetary policy is on the right track. He reiterated that the country’s monetary policy is pursuing levels of inflation that will ensure long-term growth and that the government will not abandon this goal.

“Nothing is worse for growth than rising inflation, because, in the first place, it consumes family income, and, in second place, it disorganizes the economy,” he observed.

Palocci affirmed that the quest to keep inflation down preserves family income and guarantees consumption. He pointed out that industry achieved record growth in 2004 and that workers’ incomes also rose.

The Minister contended that these two factors, together with an adequate system of credit, help enable families to consume.

In Palocci’s view, the country is experiencing a moment of favorable investments, and periods of slower economic activity are normal, since linear growth is non-existent.

Translation: David Silberstein
Agência Brasil


You May Also Like

Lula Scolds ‘Cartel of Powerful’ for Blocking Brazil’s Progress

Brazilian President, Luiz Inácio Lula da Silva, said that Brazil's booming ethanol business won't ...

Brazil to Teach Rural Workers How to Care for Forest

Brazil’s National Institute of Colonization and Agrarian Reform (Incra) and the Brazilian Institute of Environment ...

Brazilian Port Gets a US$ 10 Million Revamping

Barão de Teffé port, in the city of Antonina, in the southern Brazilian state ...

100 Countries in Brazil for Talks on Corruption and Money Laundering

Brazil’s Minister of Control and Transparency, Waldir Pires, of the Federal Comptroller-General’s Office (CGU), ...

Foreign Bulls Stir Brazil’s Market

Brazilian  market strengthened this Friday, January 14, amid a batch of economic news, with ...

Painted with A. Tonal Corantes dyes

Another Brazilian Shoes’ Incursion into Africa

Brazil's shoe components industry will be strongly represented in the mission to North Africa ...

Greenpeace: In the Wake of Brazil President’s Failure We’re Taking and Demanding Action

The new Rainbow Warrior is in action to defend the Amazon and its people. ...

Brazilian Chicken Exports Grow 20%

Brazilian chicken exports amounted to 231,871 tons in March, for revenues of US$ 256.8 ...

Brazilian Exports Grow 30%

The Brazilian trade balance registered a positive result of US$ 1.1 billion for Brazil ...

Palestine Should Be Main Focus of Brazil’s World Social Forum

Politicians, intellectuals, organizations, unions and associations from Brazil and abroad are going to debate ...