Introduction
Brazil’s gross domestic product (GDP) has outperformed expectations, continuing the country’s economic upswing. Consumer spending increased by 1.2% in 2017, outpacing decreases in government expenditures and exports (Mele, 2019). Additionally, every significant industry reported good growth for the quarter, indicating that economic growth was pervasive. High commodity prices had historically bolstered Brazil’s economy since it earned better prices for its significant oil exports, iron ore, and agricultural products.
Brazil’s Economic Outlook
Exports have been one of Brazil’s economy’s biggest positives. In terms of US dollars, year-to-date goods exports increased in August compared to the same month last year by 19.1%. Brazil’s exports have increased because of high commodity prices and increasing worldwide demand for goods (Mele, 2019). However, it is anticipated that export growth will slow. The demand for Brazil’s exports will decline due to a weaker global economy, the possibility of a worldwide recession, and the consequent decline in commodity prices.
Rio de Janeiro Analysis
Since oil was discovered in the Campos Basin, Rio has drawn many oil corporations. The city is home to numerous branches of major multinational oil firms like Shell, EBX, and Esso (Silva et al., 2021). Rio is a central financial and service hub and ranks second in the manufacturing industry. The banking industry dominates the service sector, a dynamic component of the economy. Bolsa da Valores, the stock exchange in Rio, is Brazil’s second-most active stock market. Rio’s economy benefits from tourism, both from foreigners and native Brazilians.
The economy of São Paulo
São Paulo’s diverse and complex economy is the most significant supplier of capital goods, consumer products, raw materials, and services to other areas in Brazil and internationally. The State of São Paulo contributes 32.12% of Brazil’s GDP, according to the State Data Analysis System and the Brazilian Institute of Geography and Statistics (Gutberlet et al., 2020). Moreover, according to the World Economic Outlook’s indicated PPP exchange rate, the state generated US$ 568 billion worth of wealth or US$ 23,099 per individual (Gutberlet et al., 2020). Thus, São Paulo plays an essential role in the national economy.
Conclusion
Therefore, with inflation starting to decline, Brazil’s economy should be well prepared for faster real growth. The job market’s improvement increased consumer trust, and a halt to interest rate increases should all help domestic consumption. However, the issue that must be considered is that the outer economic atmosphere is worsening. Exports, which have been a source of growth ever since the outbreak, would suffer from a worldwide recession.
References
Gutberlet, J., Besen, G. R., & Morais, L. P. (2020). Participatory solid waste governance and the role of social and solidarity economy: Experiences from São Paulo, Brazil. Detritus, 13(13), 167-180.
Mele, M. (2019). Economic growth and energy consumption in Brazil: cointegration and causality analysis. Environmental Science and Pollution Research, 26(29), 30069–30075. Web.
Silva, W. G., da Silva Ferreira, F. D., & Maia, A. C. N. (2021). Fiscal Conditions and International Economic Crisis: An Analysis Between São Paulo And Rio De Janeiro Municipalities. Revista de Economia Mackenzie (REM), 18(1), 92-114.