Economic Overview
For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.
Brazil is the world's thirteenth largest economy. The country is still working on rebuilding itself after the recession that happened eight years ago, when the economy contracted by almost 7%. Since then, Brazil hasn’t been able to grow at the same pace it was used to during the decade before the recession hit. However, the Brazilian economy has been experiencing a slow but steady recovery in recent years. In 2022, GDP grew by an estimated 2.8%, mainly driven household consumption, private investment, and exports. South America's largest economy is expected to grow at a slower pace in the coming years, with the IMF predicting a GDP growth of 1% in 2023 and 1.9% in 2024.
In 2022, inflation rate reached an estimated 9.4%, surpassing the Central Bank's target of 3.5% and its tolerance band of 5% - and salaries haven't followed. However, inflation is expected to decrease to 4.7% in 2023 and 3.9% in 2024. The relatively high inflation rate and tighter credit conditions weakened household consumption in 2022. However, the Brazilian government claims the worst for the economy is already behind. In 2022, government debt decreased to 88.2%, and is expected to remain stable over the next two years at 88.9% in 2023 and 90.6% in 2024. The government budget balance registered a deficit of 6.5% in 2022, a rate which is expected to slightly increase to 7.5% in 2023, before decreasing to 6.8% in 2024. Although the pandemic has significantly impacted the Brazilian economy, the country has been recovering, following the implementation of the government measures to counteract the resulting economic crisis. Overall, Brazil's counter-cyclical packages in light of the pandemic have been effective in boosting economic activity, which has been gradually recovering.
The unemployment rate in Brazil decreased in 2022, reaching an expected 9.8%, as the country recovered from the impacts of the pandemic. However, the government believes that the real figures are significantly higher, as an official unemployment survey shows that around 32 million people are under-utilised - meaning that they are either not working or working less than they could. Additionally, even those who are employed, often have informal jobs. In fact, the government estimates that 39.3 million people, or 41.6% of the country's employed work force, have informal jobs. The IMF expects that the unemployment rate will slightly decrease to 9.5% in 2023 and remain stable in 2024, especially as the services sector continues to recover from the aftermath of the pandemic and household consumption increases as inflation reduces. Furthermore, the country continues to face social issues and has one of the highest levels of inequality in the world, with high disparities between the country's regions. Even though Brazil has lifted 28 million people out of poverty in the last 15 years, 10% of the population still live in poverty, while the country's richest 5% have the same income as the remaining 95% of the population.
| Main Indicators | 2020 | 2021 | 2022 (E) | 2023 (E) | 2024 (E) |
| GDP (billions USD) | 1,476.09 | 1,648.70 | 1,924.13 | 2,081.24 | 2,210.62 |
| GDP (Constant Prices, Annual % Change) | -3.3 | 5.0 | 2.9 | 0.9 | 1.5 |
| GDP per Capita (USD) | 6,971 | 7,755 | 8,995 | 9,673 | 10,218 |
| General Government Balance (in % of GDP) | -11.8 | -4.5 | -7.6 | -9.0 | -8.3 |
| General Government Gross Debt (in % of GDP) | 96.8 | 90.7 | 85.9 | 88.4 | 91.5 |
| Inflation Rate (%) | 3.2 | 8.3 | 9.3 | 5.0 | 4.8 |
| Unemployment Rate (% of the Labour Force) | 14.2 | 11.1 | 7.9 | 8.2 | 8.1 |
| Current Account (billions USD) | -28.21 | -46.36 | -55.96 | -56.81 | -59.21 |
| Current Account (in % of GDP) | -1.9 | -2.8 | -2.9 | -2.7 | -2.7 |
Source: IMF – World Economic Outlook Database , October 2021
Country Risk
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