Happy Monday! This week, we take a look at what is holding Brazil’s economy back. And the ESG push within Brazilian industries.
⚠️ Important: Our newsletter services will be interrupted tomorrow, as it is a national holiday in Brazil. But we’ll be back on Wednesday!
Thought Bubble: Missed economic opportunities
Brazil’s inflation and benchmark interest rates should hit double digits next year, if not before. Not that long ago, the consumer price index stood at around 3 percent, and interest rates were 2 percent at the beginning of the year. Meanwhile, the Brazilian stock market closed the month of October down 6.74 percent, in its worst monthly performance of 2021. The future will tell whether Brazil has already hit rock-bottom, or if the economy will remain in tatters.
- But one thing is certain: things didn’t need to be this bad.
U-turn. During the 1980s and early 1990s, Brazil endured persistent hyperinflation, constant political crises, and debt defaults. Since 1994, however, the country was able to make great strides, thanks to:
- a new currency, the Brazilian Real, which became strong thanks to severe austerity measures;
- a fiscal responsibility law, holding public officials accountable for the spending they authorize;
- the...