There is a positive sentiment about Brazil, backed by recent data. Q2/23 saw a higher-than-expected growth rate of 3.6% (SAAR), including an increase in net investment. Unemployment has decreased, and exports are on the rise, primarily due to the expanding agribusiness sector. While there is consensus on a slowdown in the coming year, forecasts for 2023 and 2024 have been revised upwards. Inflation has been brought under control, and there is optimism for further interest rate cuts, potentially bringing the base rate below double digits. The fiscal concerns that worried investors at the beginning of the year have been addressed. Although not without flaws, these measures have sufficiently alleviated fears of a debt crisis and have led to improved credit ratings. There is also the possibility of a significant tax reform bill being passed still in 2023. The return of a pro-democracy, pro-environment, and pro-multilateralism administration has been warmly received by foreign investors.

The problems remain, nonetheless. Potential GDP estimates are below 2%. Increased public spending and uncertainties surrounding new revenue measures could result in higher debt-to-GDP ratios, potentially nearing 75%. The administration’s flexibility is constrained by an activist Congress that seeks quid-pro-quos in election spending. Furthermore, the administration’s tendency toward populist approaches and its support of discredited developmentalist ideas undermine its pro-investment agenda.

These concerns, among others, took center stage at our “2023 Brazil: Economic and Political Outlook,” which united an esteemed panel of analysts who assessed and shared their insights on Brazil’s economic and political prospects.

Watch the highlight video of this informative and enlightening biannual program.

Welcoming Remarks:

John Vetterli, Partner, White & Case

Introductory Remarks:

Paulo Vieira da Cunha, Partner, VERBANK Consulting, LLC

Moderator:

Drausio Giacomelli, Head of EM Research, Deutsche Bank Securities

Speakers:

Lucas de Aragão, Partner, Arko Advice

Zeina Latif, Principal, Gibraltar Consultoria

Samar Maziad, Vice President, Senior Analyst, Moody’s

Alberto Ramos, Managing Director, Goldman Sachs