Brazil is undergoing its slowest post-recession economic recovery in the country’s history. At the current pace, the Brazilian economy will only return to 2014 levels in Q3 2023—almost one decade after the start of the two-year recession. One piece of data exemplifies the slow pace of growth: Brazil’s total spending on wages, including social security benefits, is expected to rise by only 1.1 percent this year, to BRL 1.18 trillion.
Not long ago, Brazil was the world’s darling, considered one of the countries possessing the most potential for growth, a sentiment best captured by The Economist’s famous cover, depicting Christ the Redeemer as a rocket launching into space. Becoming a world power, it seemed, would only be a matter of time. Now, however, we are where we are.
Stubbornness, incompetence, and political ineptitude are among the main reasons that Brazil has become such a problem country.
Unemployment rates continue sky-high, with 13.4 million people out of work. Overall, one-quarter of the country’s workforce is either unemployed or underemployed. Family consumption—the driving force of Brazil’s GDP—is stalled, and even interest rates being at an all-time low have not been enough to stimulate growth.
Although a global economic slowdown has certainly contributed to our current state, what is happening to Brazil now is heavily due to the country’s own succession of bad choices. It’s as though we keep recovering from crises, only to be engulfed by the next one.
And yet, this has happened since Brazil became Brazil.
The Independence crisis (1820s)
When Brazil became a sovereign country it was already haunted by stagnation and debt. When Dom Pedro I declared independence from Portugal in 1822, Brazil suffered from a nosedive in...
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