Brazil’s surplus has reached record in 9 years
2023.01.28 02:57
Brazil’s surplus has reached record in 9 years
By Kristina Sobol
Budrigannews.com – Treasury data showed on Friday that Brazil’s central government reported its first primary budget surplus in nine years, driven by record revenues. However, this does not pave the way for continued fiscal improvement.
In 2022, the Brazilian central government, which includes the Treasury, the central bank, and the Social Security system, reported a budget surplus of $10.7 billion, or 54.1 billion reais, before interest was paid. In 2013, the most recent positive result was recorded.
It came after a surplus of 4.4 billion reais in December, which was higher than the 2.8 billion reais that a Reuters poll predicted.
The performance was widely anticipated due to record tax revenue from a more robust economy and generous dividends from Petrobras, the state-owned oil company, which were supported by rising commodity prices following the war in Ukraine.
With an improved job market, strong service resumption, and government stimulus measures on the eve of a presidential election, the Brazilian economy surprised on the upside in 2022.
The central bank polls private economists weekly and finds that GDP will rise by 3% in 2022, up from just 0.3 percent when the year started.
The team of the former president Jair Bolsonaro had been pointing out that the rebalancing of the public accounts was also due to liberal government reforms that have boosted private investment and cut unemployment.
In any case, the central government was likely to run a primary deficit once more this year, which was made worse by the fact that leftist President Luiz Inacio Lula da Silva got Congress to approve a multibillion reais spending package to fulfill his welfare campaign promises before he took office in January.
The primary deficit planned for 2023 reached an impressive 232 billion reais as a result of rising costs. Fernando Haddad, the new Finance Minister, stated that he would try to reduce it by more than half by increasing revenue and decreasing expenditures.
