Vice President Hamilton Mourão said on Monday that Brazil should have a contraction of between 5% and 6% in the Gross Domestic Product this year with the pandemic of the new coronavirus. In an interview with Bandeirantes radio, Mourão said that agribusiness should prevent a further drop in GDP.
The Treasury Secretary, Mansueto Almeida, said on Friday that the projection for a primary deficit of around 10% of the Gross Domestic Product (GDP) for 2020 can be considered, in the current situation, “optimistic”. The secretary also pointed out that the country’s major challenge is to continue to move forward with the fiscal adjustment agenda.
In another day of exuberant liquidity, with S&P back to September levels, Brazil has just raised $3.5 billion in the international debt market. Demand exceeded $ 9 billion, causing a rare phenomenon: secondary rates continued to close despite the new supply. In the end, the Republic issued $1.25 billion in a five-year bond and $2.25 billion in a ten-year bond.
The United States Embassy in Brazil announced the donation of an additional $6 million to help Brazil mitigate the effects of the new coronavirus pandemic. The total donated by the USA to date is $12 million (approximately R$66 million).
Caixa Econômica Federal paid R $ 65.5 billion ($ 12 billion)in emergency aid, in addition to the first and second instalments, said the bank’s president, Pedro Guimarães. In total, 55.9 million people have received some portion of the benefit since the program was created in April, to help people cope with the impacts of the covid-19 crisis.
Demand greater than that predicted by the R$ 600 ($ 110) emergency aid raised the forecast for spending on the benefit to R$ 151.5 billion ($ 28 billion). The estimate, however, considers only the payment up to the third instalment, not taking into account a possible extension of the aid. The amount is 54.2% higher than the initial projection of R$ 98.2 billion ($ 18 billion) announced by the government.
São Paulo announced the signing of a concession contract between the São Paulo State Transport Agency (Artesp) and the Eixo SP concessionaire to operate the PiPa Lot (between Piracicaba and Panorama). With the signing of the contract, Eixo SP takes the largest road network ever tendered in Brazil, with 1,273 kilometres, for a period of 30 years. The winning consortium, under the leadership of Banco Pátria, will make an investment of R$ 14 billion ($ 2.6 billion).
The federal government revised the official estimate for the Gross Domestic Product (GDP) of 2020 and started to forecast a fall of 4.7%. The number was released by the Ministry of Economy on Wednesday (13) through the 2020 budget revenue and expenditure report. The previous forecast, released in March, at the beginning of the crisis generated by the new coronavirus pandemic, was that the economy would grow by 0.02% this year.
The consolidated public sector accounts, which include the federal government, states, municipalities and state-owned companies, registered a primary deficit of $ 4.3 billion in March, according to information released by the Central Bank. The deficit occurs when public sector spending exceeds revenue from taxes and contributions.
The economic crisis triggered by the coronavirus already has an impact on the road concession sector and will require a review of contracts, according to industry experts. The movement of concessioned roads decreased by an average of 18.4% in March. The flow of passenger vehicles registered the biggest drop: 22.7%. Cargo vehicle traffic decreased 4.1%.