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Countries can often handle one horrendous government. Likewise, countries have also been able to survive a deadly pandemic. The problem comes when both happen simultaneously. Since March 2020, the Covid-19 health crisis has steamrolled the Brazilian population, leaving an eye-watering human toll as well as drastic economic consequences. Poverty, inequality, and unemployment hit their worst levels in a decade, decimating purchasing power in the process. Now, the simple act of paying increasingly high monthly bills is becoming something of a Sophie’s Choice.
And 2022 is already getting off on the wrong foot. In early January, Brazil’s oil major Petrobras raised the price of gas by 8 percent, following seemingly never-ending hikes to kitchen gas, electricity, and water last year. Brazil’s overall 2021 inflation rate came in at 10.6 percent — the highest since 2015, when the country was in the midst of its worst recession in decades until then.
With income stagnant and prices always on the rise, the equation is not adding up for millions of Brazilians. In the meantime, Economy Minister Paulo Guedes is sticking to his — perhaps unfounded — optimism. In September, he promised the Brazilian economy would “take off” in 2022.
In fact, it appears the country is actually flying blind, particularly due to the new peak in infections of the Omicron coronavirus variant. A cyberattack in December has left the Health Ministry’s Covid-19 data offline, with Brazil relying on figures taken from other sources to try and measure the extent of this new wave of cases. The uncertainty has caused fear in the markets and skepticism among business owners.
The financial situation is unlikely to improve significantly any time soon. Until then, millions of Brazilians embark on something of a wheel of misfortune at the start of every month — working out which bills they can afford to pay.
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