Brazil: Economy set to grow 5 pct in 2008

27 December 2007

Sao Paulo, Brazil, 27 Dec – Brazil’s economy will expand by 5 percent during the coming year, driven by an environment favorable to investments and foreign demand, according to a study by the National Confederation for Industry (CNI).

The study by Brazil’s employers’ organization, dubbed “Brazilian Economy Performance and Perspectives”, says growth will be led by the industrial sector, which will expand by 5 percent, more than the 4.8 percent expected in the agro-cattle sector and the 4.5 percent forecast for the service sector.

Family consumption in Brazil will rise by 6.2 percent and, “as in 2007, internal demand will have a fundamental importance to economic growth in 2008.”

The CNI forecasts that unemployment will hit 9 percent of the active population, lower than the 9.5 percent predicted for 2007 and the 10 percent recorded in 2006.

The coming year will be a good year for private investments in Brazil, which are set to increase by 14 percent, as well as a marked rise in state spending because 2008 is an election year, noted the CNI study.

Emerging economies like China, India and Russia are expected to maintain economic growth of 10 percent and increase their demand for raw materials, boosting Brazil’s production and exports, the study concludes. (macauhub)