A positive surprise halted bad expectations for the Brazilian economy, but there is still no end in sight to the slow growth that has been the three last years.

Released yesterday, the Gross Domestic Product – the production and income measurement in the country – from 2013 showed modest growth of 2.3% thus becoming the worst three-year period since the late 90s.

The impetus came from the last quarter, an improvement of 0.7% in comparison to the previous quarter. Until then, the fear was a negative rate, which would allowed for a recession diagnosis.

With the discovery that the economy was not as bad, in December, the expectations for this year are likely to improve, due to a more pleasant start point.


The Rousseff administration could still celebrate the 6.3% accounted growth from investments, in other words, from public and private spending on infrastructure projects and equipment purchase made to increase production.

However, not even the inveterate optimism of Finance Minister Guido Mantega, reaches the point that he would project better rates for GDP in a visible horizon – after all, weakning signs remain in the results.

Household consumption rates, which had been boosting the economy in previous years, was similar to GDP growth. It was the lowest in a decade.

It is an exhaustion sign in the official strategy to stimulate purchases through credit, especially in state-owned banks and the expansion of income transfer programs.

In theory, the driving force of the economy should now move from consumption to investment. However, the entrepreneur spirit cooled down in the second half of 2013, with new uncertainties in the global scenario, rising interest rates to curb inflation and the prospect of an increasing dollar rate.

Despite the improvement, concentrated in the first half of the year, the share invested in national income did not exceed 18.4%, down from 19.5% at the end of Lula’s government and, further yet, the 25% expected by the government.

Considered by the market one of the countries most vulnerable to disruptions in the global economy, Brazil accumulates under Dilma’s government the weakest growth among major emerging economies – although there is a general slowdown.

The per capita income rose only 1.4% and reached exactly R$24,065 (US$ 10,254) last year, or just over R$2,000 (US$ 852) a month.