Water Crisis And Politics Are Expected To Slow Down Investment Pace In Brazil, Says FGV

Written by Fabio Lucas Carvalho

Published on 08/09/2021 at 13:01

Foto: Marcelo Camargo/Agência Brasil

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Water Crisis And Political Crisis Are The Main Factors That Should Slow Investments This Year And The Beginning Of Next Year

Many Brazilians were excited about the economic recovery after the progress of vaccination and prospects for the end of the pandemic; however, things are not going as expected. The political and water crisis is causing severe damage to investments in the country.

According to an assessment made by FGV specialists, the water crisis, along with the political crisis, should slow investments in Brazil at least until the beginning of next year.

The Investment Intention Indicator rose slightly in the third quarter of this year; however, the services sector at 110.9 points and construction at 103.6 points are below the levels recorded before the pandemic. The highest number is in the industry, with 129.2 points, but it is lower than what was recorded at the beginning of the year, 132.8.

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The Coming Months Should Be Of Low Growth

In a survey conducted by Estadão, Rodolpho Tobler, responsible for the confidence survey at FGV, expects a scenario of low growth in the coming months. The high unemployment rate, inflation, and water crisis are the main factors that justify a perspective of low economic growth economic.

With the GDP decrease in the second quarter of this year, growth prospects for the economy have fallen by about 5% for this year. However, economic growth for 2022 is expected to remain high between 1% and 2%. This situation should reduce the pace of investments in Brazil.

Water Crisis And Politics Are Expected To Slow Down Investment Pace In Brazil, Says FGV

Water Crisis And Political Crisis Are The Main Factors That Should Slow Investments This Year And The Beginning Of Next Year

The Coming Months Should Be Of Low Growth

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Water Crisis And Politics Are Expected To Slow Down Investment Pace In Brazil, Says FGV

Water Crisis And Political Crisis Are The Main Factors That Should Slow Investments This Year And The Beginning Of Next Year

The Coming Months Should Be Of Low Growth

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