Brazil’s economic growth has shown positive numbers, but experts warn of possible imbalances that could affect the country’s future.
In an interview with WW This Tuesday (3), economist Silvia Matos, coordinator of the Macro Bulletin of the Brazilian Institute of Economics of Fundação Getulio Vargas (FGV Ibre), highlighted the importance of looking beyond the present and considering long-term perspectives.
The concern is that, without increasing productive capacity, growth above the economy’s potential could generate inflationary pressures and other imbalances. This could lead to corrective measures, such as increasing interest rates, which end up slowing economic growth itself.
“It is very important for us to increase this productive capacity, because we can grow, have numbers closer to 3% and without generating inflation, without generating noise and negative effects in the medium and long term, as now with the rise in interest rates”, explains.
The economist highlights that the composition of current growth is different from that observed last year, when sectors such as agriculture and extractive industries, considered very productive, boosted the economy.
“Last year, sectors such as agriculture, the extractive industry, sectors that are very productive, were very positive for the economy, a lot of external demand, less domestic demand”, he points out.
Currently, the scenario is different. “Today we have an economy very much driven by domestic demand, by consumption. And we saw consumption figures growing well above GDP”, warns FGV Ibre coordinator. “This is a sign that the economy is not in a position to generate this maintenance of growth”, she adds.
For the economist, this unsustainable growth could lead to an increase in inflation, mainly harming low-income people.
“We have to think not only about the moment, the past and present, but about the future”, concludes Matos.
