BRAZIL.
BRAZIL
% Change (In millions US $)
Interest Trade
Date CPI M1 Rate(%) Imports Exports Bal
1990 1,794.8 2,350.0 -- 20,478.0 31,378.0 10,900.0
1991 460.0 300.0 900.0 21,584.0 32,486.0 10,902.0
1992 1,147.0 913.0 1,180.0 20,542.0 36,207.0 15,665.0
1993 1,600.0 600.0 -- 24,870.0 38,821.0 14,300.0
1994 800.0 200.0 1,600.0 33,535.0 43,659.0 10,124.0
1995 20.0 25.0 70.0 50,000.0 46,900.0 -3,100.0
1996 10.0 -15.0 35.0 52,900.0 47,700.0 -5,540.0
1997 4.8 5.0 22.0 62,080.0 53,090.0 -8,990.0
1998 -18.0 1.0 38.0 57,550.0 51,120.0 -6,430.0
1999 9.1 15.0 26.6 49,138.0 48,483.0 -655.0
Jan 0.5 -- 41.0 3,700.0 2,940.0 -154.0
Feb 1.4 -- 45.0 3,050.0 3,270.0 249.0
Mar 0.6 -- 42.0 4,050.0 3,830.0 -220.0
Apr 0.5 -- 32.0 3,670.0 3,700.0 300.0
May -0.4 -- 24.5 4,070.0 4,380.0 312.0
Jun 0.8 -- 21.0 4,450.0 4,310.0 -144.0
Jul 1.1 -- 20.3 4,023.0 4,117.0 94.0
Aug 0.7 -- 19.2 4,458.0 4,770.0 -101.0
Sep 0.9 -- 19.1 4,254.0 4,187.0 -67.0
Oct 1.1 -- 18.8 4,458.0 4,304.0 -154.0
Nov 1.5 -- 18.7 4,531.0 4,002.0 -529.0
Dec 0.5 -- 18.8 4,424.0 4,673.0 249.0
2000 4.4 8.0 16.5 55,777.0 55,086.0 -691.0
Jan 0.6 -- 19.0 3,569.0 3,453.0 -94.0
Feb -0.2 -- 19.0 4,047.0 4,123.0 78.0
Mar 0.2 -- 18.5 4,451.0 4,472.0 42.0
Apr 0.1 -- 18.5 3,995.0 4,181.0 183.0
May 0.0 -- 18.5 4,700.0 5,063.0 392.0
June 0.2 -- 17.5 4,605.0 4,861.0 258.0
Jul 1.4 -- 16.5 4,887.0 5,003.0 118.0
Aug 1.6 -- 16.5 5,423.0 5,519.0 97.0
Sep 0.3 -- 16.5 5,046.0 4,724.0 -320.0
Oct 0.0 -- 16.5 5,162.0 4,638.0 -523.0
Nov -0.1 -- 16.5 5,020.0 4,390.0 -630.0
Dec 0.3 -- 15.8 4,872.0 4,659.0 --
2001 5.5 7.0 18.0 58,000.0 58,400.0 400.0
Jan 0.4 15.30 5,017.0 4,538.0 -479.0
Feb. 0.11 15.25 4,003 4,083 80.0
Mar 0.51 15.75 5,446 5,167 -279.0
Apr 0.61 16.25 4,610 4,730 120.0
May 0.17 16.75 5,156 5,367 211
Column
Number 1 2 3 4 5 6
(In millions US $)
Current Exchange Rate
Date Acct Bal Reserves Off/Par
1990 1,790.0 8,751.0 172.0 190.0
1991 2,000.0 8,552.0 1,090.0 1,120.0
1992 6,450.0 19,893.0 12,241.0 14,600.0
1993 2,000.0 23,000.0 320.0 325.0
1994 -1,000.0 36,471.0 0.9 0.9
1995 -17,000.0 50,000.0 1.0 1.0
1996 -15,000.0 58,000.0 1.0 1.0
1997 -33,800.0 51,000.0 1.1 1.1
1998 -34,900.0 44,600.0 1.2 1.2
1999 -27,000.0 36,353.0 1.8 2.0
Jan -- 36,400.0 2.1 2.0
Feb -- 35,600.0 2.0 2.1
Mar -- 34,600.0 1.7 1.7
Apr -- 44,300.0 1.7 1.7
May -- 44,300.0 1.7 1.8
Jun -- 43,000.0 1.8 1.8
Jul -- 41,346.0 1.8 1.9
Aug -- 41,918.0 1.9 2.0
Sep -- 42,753.0 1.9 2.0
Oct -- 40,053.0 2.0 2.0
Nov -- 42,175.0 1.9 2.0
Dec -- 36,353.0 1.8 2.0
2000 -24,000.0 32,844.0 2.0 2.1
Jan -- 37,560.0 1.8 2.0
Feb -- 38,364.0 1.8 1.9
Mar -- 39,169.0 1.7 1.9
Apr -- 33,333.0 1.8 1.9
May -- 28,581.0 1.8 1.9
June -11,300.0 28,264.0 1.8 1.9
Jul -12,706.0 29,614.0 1.8 1.9
Aug -- 31,396.0 1.8 1.9
Sep -24,800.0 31,203.0 1.8 2.0
Oct -24,680.0 30,404.0 1.9 2.1
Nov -- 32,582.0 2.0 2.2
Dec -- 32,844.0 2.0 2.2
2001 -24,000.0 34,000.0 2.1 2.4
Jan 35,604.0 2.0 2.1
Feb. 35,450 2.04 2.13
Mar 34,390 2.15 2.21
Apr 35,471 2.37 255
May 35,471 2.37 2.55
Column
Number 7 8 9 10
FOOTNOTES BY COLUMN: Annual figures for 2001 are projections. 1-2:
Annual figures represent January December increase. 3: Interest
rates shown for 1998 are the effective nominal monthly rate for 180
day loans. As of 1999, rate shown is Selic overnight rate. Annual
figures represent monthly average for year. 4-0: Annual figures
represent values at year end. 9: A new currency, the real,
was introduced in July 1994.
SOURCES BY COLUMN: 1, 2, 4-9: Central Bank. As of 2000, inflation
figures are from IPC FIPE.
FINANCIAL OUTLOOK * Annual inflation forecasts have been increased by FIPE FIPE Federazione Italiana Pubblici Esercizi (Italian Federation of Bars and Catering) from 4% to 5%, due to increased transportation costs and higher energy, water and gasoline prices. Central bank officials predict inflation will rise 1.5 percentage points because of the sinking real during first-half 2001. Both the finance ministry and the central bank believe Brazil will meet its 2001 IMF IMF See: International Monetary Fund IMF See International Monetary Fund (IMF). inflation target of 4%, with a cushion of 2%, meaning that inflation can be as high as 6% and still meet IMF goals. The finance ministry announced a 2002 target of 3.25%, also with a 2% cushion, while the central bank projects inflation for 2002 will be 3%. * The benchmark Selic interest rate has been steadily rising from its January low of 15.25%. Ongoing concerns about Argentine contagion Contagion The likelihood of significant economic changes in one country spreading to other countries. This can refer to either economic booms or economic crises. Notes: An infamous example is the "Asian Contagion" that occurred in 1997 and started in Thailand. and the depreciation of the real have sparked concerns over inflationary pressure, pushing the central bank to hike interest rates to 18.25% from 16.75%. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the minutes of the last central bank meeting, potential damage to the economy from a falling real required the central bank to "increase significantly" the Selic rate. * The trade balance may move into positive territory this year. The deficit has shrunk shrunk v. A past tense and a past participle of shrink. shrunk Verb a past tense and past participle of shrink shrunk, shrunken shrink from $678 million at the end of the first quarter to $70 million at the end of the first half, as the sinking real has squelched squelch v. squelched, squelch·ing, squelch·es v.tr. 1. To crush by or as if by trampling; squash. 2. imports and boosted exports. Overall, exports have reached record highs, despite the crisis in top trading partner Argentina and Brazil's own energy crisis. The temporary reduction of the Mercosur common external tariff When a group of countries form a customs union they must introduce a common external tariff. The same customs duties, import quotas, preferences or other non-tariff barriers to trade apply to all goods entering the area, regardless of which country within the area they are entering. (TEC) from 14% to 0% on capital goods Capital Goods Any goods used by an organization to produce other goods. Notes: Examples of capital goods include office buildings, equipment, and machinery. See also: Capital Expenditure, Disinvestment Capital goods could prove to be problematic for Brazil. A 0% TEC could push down exports to Argentina by 50%. * Reserves increased in the second quarter because of a government decision to draw $2 billion from the IMF. The government also decided to suspend a payment due to the IMF at the end of the year. Central bank president Arminio Fraga Arminio Fraga was the former president of the Central Bank of Brazil, from 1999-2002. He is also a former associate of George Soros and his Quantum Fund. In 2003, he founded the Rio de Janeiro based investment company, Gávea Investimentos. announced that the government would increase the amount of bonds it plans to issue in 2001, from $6 billion to $7 billion. Foreign reserves jumped to $37.998 billion after the IMF capital injection. * The real continues to fall, hitting record low levels since it was created in 1994. Culprits are the uncertainty surrounding Argentina's financial situation and fears that the energy crisis will hurt Brazil's economy in the coming years. The central bank was forced to intervene several times during the month of June to shore up the currency's value. On June 20, the real plunged to an all-time low of R2.47:$1, reflecting a 30% loss since January, before the central bank decided to step in. By mid-July, it had fallen as low as R2.553:$1. ECONOMY MONITOR * Growth Outlook: The energy crisis has forced down many of this year's earlier optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op growth projections. The finance ministry predicts 3.6%, despite the crisis, but the central bank forecasts 2.8%, down from 4.3% in March. Joyce Chang of JP Morgan has lowered her projection to 2.5% for 2001 and to 3% for 2002. Deutsche Bank Deutsche Bank AG (IPA: /'dɔɪ.tʃə/[1]) (ISIN: DE0005140008, NYSE: DB) (English: German Bank analysts have lowered predictions to 2.6% for 2001 and 3.2% for 2002. First-quarter growth was 4.13%. * Political Factors: President Fernando Henrique Cardoso's popularity has plummeted after reaching record highs at the beginning of the year. The energy crisis and a number of corruption scandals among members of the ruling coalition have contributed to the Cardoso's fall from favor. Among the more serious scandals was the violation of the voting panel of the senate, which lead to the resignation of two powerful senators, including former senate president Antonio Carlos Magalhaes. Current senate president Jader Barbalho is also under fire, because of accusations of corruption while he was a minister in the Sarney administration (1985-90). Some analysts fear that the energy crisis and the crisis in the ruling coalition will threaten Cardoso's ability to handpick hand·pick tr.v. hand·picked, hand·pick·ing, hand·picks 1. To gather or pick by hand. 2. To select personally. hand his successor next year. At present, health minister Jose Serra and the Ceara governor Tasso Jereissati are still considered likely candidates. The PMDB PMDB Partido do Movimento Democrático Brasileiro (Brazilian Democratic Movement Party; Brazil) PMDB Project Master Database PMDB Project Management Database PMDB Preventive Maintenance Database PMDB Performance Measurement Data Base has threatened to abandon the coalition and pick its own candidate. One possibility is former president and current Minas Gerais Minas Gerais (mē`nəs zhərīs`) [Port.,=various mines], state (1996 pop. 16,660,691), 226,707 sq mi (587,171 sq km), E Brazil. The capital is Belo Horizonte. Minas Gerais continues to produce more than half of Brazil's mineral wealth. governor Itamar Franco Itamar Augusto Cautiero Franco, usually known as Itamar Franco (pron. IPA: [ita'max 'fɾɐ̃ku]), (born June 28, 1930) is a Brazilian politician who was President of Brazil from October 2, 1992 to January 1, . The Workers Party recently announced an economic plan intended to calm the nerves of foreign investors. * Fiscal Situation: The finance ministry announced a five-part program that should help improve Brazil's fiscal situation. The program includes an extension of the CPMF CPMF Contribuição Provisória Sobre Movimentação Financeira (Brazilian excise tax) CPMF Client Partnership Management Framework CPMF Central Paramilitary Force (India) CPMF Computer Program Maintenance Facility financial transactions tax until 2004, higher import taxes and lower taxes on exports, higher fuel taxes and revamping of the current sales tax sales tax, levy on the sale of goods or services, generally calculated as a percentage of the selling price, and sometimes called a purchase tax. It is usually collected in the form of an extra charge by the retailer, who remits the tax to the government. . The primary surplus was within the IMF target of R16.7 billion (approximately $6.79 billion) for the first five months of the year, while the current account deficit reached $11.426 billion (5.25% of CDP CDP (cytidine diphosphate): see cytosine. (1) (Certificate in Data Processing) An earlier award for the successful completion of an examination in hardware, software, systems analysis, programming, management and accounting, ), just below the 5% IMF target. * Major Sectors: Industrial production continued to grow in the first quarter, with a 6.1% increase. This pace is expected to slow dramatically in the third quarter as a result of the energy crisis. Both industrial and residential consumers have been asked to cut consumption by 20%. The crisis has especially hurt electronics manufacturers, which have noticed a significant drop in purchases within Brazil. * Employment: Despite fears that unemployment would climb due to energy rationing rationing, allotment of scarce supplies, usually by governmental decree, to provide equitable distribution. It may be employed also to conserve economic resources and to reinforce price and production controls. , it has continued to drop or remained steady. According to official statistics bureau IBGE, national unemployment reached 6.5% in both March and April. According to labor-union-supported think tank Diesse, unemployment dropped by 1.8% in the city of Sao Paulo in May. The percentage of unemployed people Noun 1. unemployed people - people who are involuntarily out of work (considered as a group); "the long-term unemployed need assistance" unemployed plural, plural form - the form of a word that is used to denote more than one is expected to increase in June because energy rationing has prompted many manufacturers to cut production and lay off employees * Stock Market: With the minority shareholder's law awaiting senate approval for the past 18 months, Sao Paulo Bovespa officials have taken several steps to improve minority shareholder's rights, corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. and transparency. In addition to the Novo Mercado For the hispanic surname "Mercado", please see de Mercado. Mercado first originated in Spain. In English it means 'market'. Is the last name of the 'Great' Fifa Soccer player Eswold. , launched last November, the Bovespa has also started a new program to reward companies for improving investor relations Investor relations The process by which the corporation communicates with its investors. . On June 26, the new Corporate Governance program listed 15 companies as Level One, allowing them to receive a larger share of funds from Brazilian institutional investors Institutional Investor A non-bank person or organization that trades securities in large enough share quantities or dollar amounts that they qualify for preferential treatment and lower commissions. . They are Bradesco, Bradespar, Gerdau, Globo Cabo, Banco Itau, Itausa, Perdigao, Randon, Sadia, Unibanco, Unibanco Holdings, Varig, Varig Servicos, Varig Transportes and Weg. COMPANY MONITOR * Airplane manufacturer Embraer won a contract valued at $750 million to $3 billion to provide up to 100 large jets to Brazilian airline TAM. National development bank BNDES BNDES Banco Nacional de Desenvolvimento Econômico e Social (Brazilian Development Bank) BNDES Banco Nacional de Desenvolvimento Econômico e Social (Brasil) , along with several pension funds, recently sold 77 million shares of Embraer, roughly 10% of the company's total capital. * Banco Itau began selling Level 1 ADRs on the New York stock exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. , and a Level 2 offering could be in the works. Itau had record first-quarter profits and the highest earnings of any public company in Brazil last year. * Citibank is close to closing a deal to buy a R$750 million ($305 million) share of Banco Meridional me·rid·i·o·nal adj. Of or relating to meridians or a meridian. . The bank is valued at R$3 billion. The deal would allow the Vidigal family to maintain some control of the bank. * Sadia and Perdigao, Brazil's top processed food companies, announced joint meat export venture BRF BRF the ratio of bulls to cows. Targets vary widely depending on circumstances and efficiency required. Trading. The firms hope to take advantage of the mad-cow and foot-and-mouth crises to boost exports. * The finance ministry announced plans to bail out Brazil's largest banks, Caixa Economica Federal and Banco do Brasil Banco do Brasil S.A. is a major Brazilian bank headquartered in Brasília. The bank was founded in 1808 and is the oldest surviving bank in Brazil — one of the oldest of Latin America. , both federally owned. Costs will run R12.5 billion ($5.4 billion) or 1% of GDP GDP (guanosine diphosphate): see guanine. . * Embratel applied to telecom regulator Anatel to offer local phone service. Doubt remains as to whether local carriers Telemar and Telefonica will meet Anatel's requirements to expand beyond their concessions. * Internet Gratis, known as iG, Brazil's largest free ISP See free Internet service. , announced that the company had reached the breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations point. Earlier this year, iG sold part of its operations to Telemar and laid off employees to reduce costs. |
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