Brazil’s gross public debt in 2020 reached the record-shattering level of 89.3 percent of the GDP. That represents a 15-point increase from 2019, due to massive expenditures to fight the Covid-19 pandemic, according to data released by the Central Bank.
With debt of BRL 6.615 trillion, there is little room to finance new measures to provide benefits to informal workers and the unemployed, according to officials. Last year, the emergency aid program was responsible for 38.5 percent of the BRL 524 billion spent on the pandemic response. Earlier this week, the federal administration announced it had ended the year with a BRL 743.1 billion deficit, in comparison with a BRL 95.1 billion loss in 2019.
The central government’s gross debt includes the federal administration, states and municipalities, and state-owned companies. Meanwhile, the debt-to-GDP ratio is always closely followed, seen as a means for analyzing a country’s ability to honor its debts. Brazil’s is far above other emerging economies, such as Chile’s 40 percent or Colombia’s 60 percent.
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