According to a recent report published by the World Bank, the Brazilian government overspends and wastes money. The study, “A fair adjustment: An analysis of the efficiency and equity of spending in Brazil,” analyzed eight areas of public spending in Brazil. It graded them based on three criteria: how much of the federal budget they make up; how efficient they are; and how much they contribute to reducing Brazil’s levels of inequality.
The report’s conclusions state that while the Brazilian government has “consistently” increased public spending – to the point of jeopardizing the country’s solvency – the levels of inequality have not been reduced. Brazil’s fiscal deficit has reached 8 percent of the GDP, and the public debt has risen more than 20 percent over the last six years, now totaling 73 percent of the GDP. The biggest issue affecting Brazil’s economy is its fiscal imbalance. At this rate, the country looks set to reach 95 percent debt to GDP ratio by 2022.