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The definitive resumption of growth in the Brazilian economy during the pandemic, as seen in the first quarter of 2021, with a 1.2% increase in GDP (Gross Domestic Product), had as its main actor the federal government itself, according to experts interviewed in a report by Revista Oeste.
Among the quick and precise actions, pointed out by the executive director of the Federation of Industries of São Paulo, André Rebelo, the flexibilization of labor rules, such as “the suspension of contracts, with reduction of salaries and working hours” and also financial aid, through public funds to supplement salaries, would have given enough breathing space for companies to survive and lay off fewer than expected, after suffering with the stay-at-home policies, determined by mayors and governors.
Rebelo also said that the delay in the collection of taxes from companies, the offer of credit lines for working capital, at low interest rates, and the injection of around R$300 billion in emergency aid, allowed the money to remain in circulation, guaranteeing consumption and, consequently, the operation of production lines.
According to experts interviewed by Oeste, including Marcelo Azevedo, economic analysis manager at the National Confederation of Industry (CNI), growth will be seen more strongly in certain sectors, such as automotive vehicles, which are mainly affected by the lack of inputs for the production of parts. In April alone, the automotive industry grew 8%, according to data from the Ministry of Economy, which should be repeated when the figures for May are announced.
The resumption of “V”-shaped growth, advocated by Economy Minister Paulo Guedes in mid-2020, at the height of the Chinese virus pandemic, is confirmed and shows the perfect harmony between President Jair Bolsonaro and his top team.
It is worth noting that, in the wake of good news, the American credit rating agency, Fitch Ratings, has just raised its forecast for growth in Brazilian GDP in 2021, from 3.3% to 5%.
And the left goes crazy!
