INDUSTRY: Brazilian industrial production grows 1.1% in March, according to IBGE

National industrial production rose 1.1% in March 2023 compared to the previous month. In comparison with the same period last year, the increase was 0.9%. The information was disclosed by the Brazilian Institute of Geography and Statistics (IBGE). For economist and financial educator Alexandre Arci, this growth is very important for economic recovery. He explains that among the factors for this resumption is the reinvestment in the industrial category itself.

“Controlled inflation, at times coming in below expectations, brings a future scenario of an adjustment of our Selic rate and a lower Selic rate increasingly stimulates consumption, favoring all industrial production.” The expert also points out that the exchange rate adjustment also brings a greater incentive for industrial production.

Of all the surveyed activities, 16 advanced in March. Among them, the sectors of coke, petroleum products and biofuels (1.7%), machines and equipment (5.1%) and computer equipment, electronic and optical products (6.7%). Other relevant positive contributions came from pharmochemicals and pharmaceuticals (3.2%), other transport equipment (4.8%), chemical products (0.6%), leather, travel articles and footwear (2. 8%) and non-metallic mineral products (1.2%).

For the industrial production scenario to continue advancing positively, economist Alexandre Arci says that some measures need to be adopted. “It is important that all tax rules are reviewed and simplified, making it easier for the entrepreneur to have more predictability, thus facilitating his entire management.”

The specialist also highlights the need to lower the Selic rate: “This makes the cost of money cheaper, reheating the entire internal economy, making it easier for those who need credit and automatically industrial production is ready to increase its entire workforce. production and so that it can meet all this demand that has been restricted since the time of the coronavirus, when a large part of the Brazilian population sought alternatives to spend less.”

Among the major economic categories, still compared to the immediately previous month, capital goods (6.3%) and durable consumer goods (2.5%) recorded the most pronounced positive rates in March 2023, with the former accumulating an increase of 7.0% in two consecutive months of advance; and the second eliminating part of the 2.7% loss accumulated in the first two months of 2023. The intermediate goods sector (0.9%) also grew and intensified the 0.5% advance registered in last February.

Tax reform

According to Deputy José Rocha (União-BA), coordinator of the Mixed Parliamentary Front for Industry, it is a timid growth, but one that must be recognized. He believes that with the government’s effort to provide legal security and less taxation, the sector can gain more momentum to continue moving forward.

“We have sectors that need to be differentiated in taxation and that will not be penalized. We are also going to focus in the National Congress on both the fiscal framework and the tax reform to give greater peace of mind to people who invest in this segment with job creation and income generation in the country. It is the segment that generates the most jobs, therefore, it is the segment that gives families the greatest social stability and the government needs to have a look at not penalizing this sector that has already suffered in the pandemic.” says the MP.