Category: Macroeconomy/Finance

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

Voltalia launches wind farm in Brazil

The French electrician Voltalia reported the start of work on a wind power generation project in Brazil and the closing of an operation to sell renewable energy certificates in the country with Itaú Unibanco. The wind power plant in Rio Grande do Norte, with 59 megawatts of capacity, is expected to begin operations in the first half of 2021, while business with Itaú involved 547,000 clean energy certificates.

Half of small and medium enterprises in Brazil had a 25% increase in online sales

A study by Facebook to map the effects of the coronavirus on small and medium businesses showed that 47% of SMEs with social networking sites said they had at least a 25% increase in online sales between January and May. The survey also showed that 43% of business owners say they are optimistic about the future of the business. On the other hand, 52% believe that cash flow will be a challenge in the coming months.

BNDES will get $ 70 mm from the Climate Fund for sustainable projects

BNDES will receive an injection of R$ 350 million ($ 70mm) from the Climate Fund, whose resources will be used to finance sanitation projects and solid waste collection. The fund was created in 2009 and allocates resources from the oil activity in the country to sustainable projects that help preserve the climate and reduce the emission of gases that contribute to the greenhouse effect.

Approval of new gas landmark may unlock $ 12 bn estimated in investments

The approval of the new legal framework for gas will modernize the regulation of the sector and may unlock R$ 60 billion ($ 12bn) in estimated investments in this area. The assessment was made by Moody’s when the House of Representatives signals to resume the assessment of the matter in the next few days, after approving, by 323 votes, the urgency for the processing of what is called the Gas Law.

BDMG prepares to raise $100 mm in green bonds with IDB support

The Development Bank of Minas Gerais (BDMG) is preparing to raise about $100 million in green bonds, with support from the Inter-American Development Bank (IDB). At the same time, environmental, social and governance-related investments (ESG) have gained increasing interest from large industrial companies, financial institutions and asset managers.

Infrastructure requires $8 bn for Pró-Brasil works

The Ministry of Infrastructure’s final proposal for investments in public works through Pró-Brasil foresees a budget requirement of R$ 40.4 billion ($ 8bn) from 2020 to 2023. The resources would be invested in 153 road, rail, waterway and airport projects. To start these works this year, the IM need an extra injection of R$ 5 billion ($ 1bn). The ministry has already executed 70% of the budget guaranteed in 2020.

Ipea proposes 0% interest in credit to SMEs for GDP growth

Micro and small businesses (MSEs) are vital to the economy. Together, they represent 96.6% of businesses and contribute to about 30% of the Brazilian gross domestic product (GDP). A report by Ipea argues that Brazil should offer subsidized credit to MSEs. The proposal is for a line to be created with interest equal to zero and a one-year grace period, with credit conditional on the maintenance of jobs for a period of up to six months after the end of social isolation.

Brazilian primary deficit expected to end 2020 at $157.6 bn

The decline in revenues caused by the pandemic should raise the primary deficit to R$787.45 billion ($157.6 bn) in 2020, the Ministry of Economy said. The primary deficit represents the negative result in the government’s accounts, not considering interest on public debt. In relation to estimates for the economy, the report maintained most projections and the GDP forecast remained at 4.7%.

Bank of Brics approves $1 bn loan to Brazil

The board of directors of the New Development Bank (NDB), the Bank of Brics, approved a $1 billion (R$ 5.3 billion) loan to Brazil. The amount will be used to pay the Federal Government’s emergency assistance to about 5 million people. With the new financing, the Brazilian portfolio of projects approved by NDB in the country now reaches $ 2.55 bn.