IMF raises Brazilian economic growth projection to 2.5% per year in the medium term

For economist Marcelo Monteiro, economic consultant at Remessa Online, the change in the IMF’s outlook can be attributed to several factors, including less intense impacts of the floods in Rio Grande do Sul and unexpected positive results in the retail sector.

“Retail data came out very positive, compared to what the market was expecting. The market was expecting a drop in retail and it came with growth of 1.2%. Perhaps economists overestimated the effects and the IMF must have incorporated these impacts into its growth projections,” explains Monteiro.

According to the report, several factors have contributed to this positive performance. Measures such as the consumption-focused tax reform and the ecological transformation plan are highlighted as significant drivers of economic growth in the medium term.

The IMF also emphasizes the importance of an agenda focused on sustainable and inclusive growth, as well as the implementation of reforms that promote a more favorable business environment. Among the milestones mentioned are the reduction of deforestation, progress in the creation of the Brazilian Sustainable Taxonomy to standardize sustainable economic practices, the structuring of the carbon market and the successful issuance of the first green bond in the international market.

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Counties

Federal advisor to the Federal Economic Council (Cofecon), Eduardo Reis Araújo, highlights that, although the upward revision is positive news, the effects will be uneven between regions and municipalities.

“This is positive news, but it should be accompanied by different effects for each city. Remembering that the projection does not necessarily mean that it will happen. Each municipality has its own ‘homework’ to adapt, especially to legislative changes such as tax reform”, highlights Araújo.

Gelton Pinto Coelho, advisor to the Regional Economic Council of Minas Gerais (Corecon-MG), explains that Brazil is a country marked by regional inequalities and this directly impacts municipalities.

“We have municipalities with high technological development and others that do not have this specialization, so to speak, in a continental country like Brazil, there is no homogeneous growth. Some municipalities will have greater growth, others will not be able to take advantage of it as much. But it is important for us to perceive several signs that the Brazilian economy is demonstrating”, he points out.

Coelho reports that in 2024 there will be a greater demand for vehicle financing, even if they are above the appropriate value.

“This shows positivity. When someone makes the decision to buy a vehicle, they expect to keep their job or maintain a certain level of income, being able to pay the installment of the financing,” he adds.