Category: Macroeconomy/Finance

Information regarding Brazil’s finance sector and the country’s macroeconomy.

Brazilian Government stops using $6.3 mm fund for the Amazon

The Brazilian Government has stopped using million-dollar resources already donated by other countries to combat crimes in the forest. More than R$33 million ($6.3 mm) already donated to Brazil through the Amazon Fund, a programme financed with money from Norway and Germany, are available for two actions: one to fight fires by Ibama and the other for the Ministry of Justice to expand the work of inspection in the forest by the National Force. These resources, however, are stored in the BNDES.

Profit of federal state-owned companies rose to $20.5 bn in 2019

State-owned companies recorded net profits of R$109.1 billion ($20.5 bn) in 2019, an increase of 53%, compared to 2018 when it was R$71.3 billion ($13 bn). According to the Ministry of Economy, there were 200 state-owned companies at the end of 2019, 46 of which were direct and 154 were indirect. Among those with direct control, 18 were dependent. At the end of 2018, the country had 209 state-owned companies.

Caixa exceeds $943 mm in credit to micro and small companies

Caixa Econômica Federal has exceeded the R$5 billion ($943 mm) in credit to micro and small businesses during the pandemic. The Support Program for Micro and Small Businesses (Pronampe) reached the limit of R$4.24 billion ($800 mm) in loans and the lines of the Guarantee Fund for Micro and Small Businesses (Fampe) lent R$1.8 billion ($339 mm).

Pronampe released $566 mm for Brazilian small businesses

The Ministry of Economy stated that Pronampe, the federal government’s programme to guarantee credit for micro and small businesses, has already released more than R$3 billion ($566 mm) in the last three days. The initiative, which is aimed at small and medium-sized companies , provides for the government’s guarantee of part of the loans made by banks to these businesses, in a lower proportion than in Pronampe.

BNDES provides $944 mn for SME’s

The National Bank for Economic and Social Development (BNDES) reached a total of R$5 billion ($944 mm) for micro, small and medium businesses in the working capital loan line. According to BNDES, 16,318 operations have already been approved with 15,094 companies, employing 372,800 people, with an average value of R$318,000 ($60k) per operation.

Brazil’s EMBI+ projected to close 2020 with an average of 350 points

Since the outbreak of the coronavirus, Brazil has risen from 210 to 388 points between February and June on JPMorgan’s EMBI+ (Emerging Markets Bond Index). This indicator works as a thermometer of the level of confidence that foreign investors have in emerging countries. Consultancy Macrosector project that EMBI+ Brazil could close the year with an average of 350 points. If this estimation is correct, it would be the worst result since the impeachment of president Dilma Rousseff in 2016, when the index hit 384 points.

Brazilian industrial production increased by 7% in May

Brazilian industrial production increased by 7% from April to May this year, according to IBGE. The rise, which is the highest since June 2018 (12.9%), came after two successive declines due to the coronavirus in March (-9.2%) and April (-18.8%). Industrial production accumulated falls of 8% in the quarterly, 11.2% for the year and 5.4% for the 12-month period.

Private banks will have a 70% loan of up to $3.1 bn to help energy distributors in Brazil

Private banks will have 70% of the so-called “Conta-Covid”, a financing package of up to R$16.4 billion ($3.1 bn) made possible with government support to help the energy distributors’ cash during the pandemic. The National Bank for Economic and Social Development (BNDES) and public banks will enter with about R$5 billion ($944 mm) in the operation, which ended up with costs higher than expected by the sector.

Brazilian trade balance has a surplus of $7.46 bn

Commercial balance is the largest for the months of June of the entire historical series, which began in 1989. The trade balance registered a surplus of $ 7.463 bn in June, the Ministry of Economy reported. Compared to June last year, there was a 38.8% increase in the balance. In the first semester, the government reported a positive balance of $ 23.035 bn, 10.3% less than in the same period of 2019.