Itaú BBA - Primary deficit of BRL 62 billion (-0.9% of GDP) in 2019

Macro Brazil

< Volver

Primary deficit of BRL 62 billion (-0.9% of GDP) in 2019

enero 31, 2020

Fiscal prints are gradually improving


For the version with all charts and tables, please open the attached pdf file
 

 The consolidated public sector posted a primary deficit of BRL 62 billion in 2019 (-0.9% of GDP), down from BRL 108 billion (-1.6% of GDP) in 2018, and below the target of BRL 132 billion (-1.8% of GDP) set for the year. The central government had a deficit of BRL 89 billion (-1.2% of GDP) vs. a target of BRL 139 billion (-1.9% of GDP). Regional governments posted a BRL 15 billion surplus (0.2% of GDP), while state-owned enterprises had a BRL 12 billion surplus (0.2% of GDP). In December, the public sector experienced a primary deficit of BRL 13.5 billion (estimate: 23.4 billion) and the central government (using the National Treasury's methodology, based on the difference between revenues and expenses) showed a deficit of BRL 14.6 billion (estimate: 8.4 billion).

 The general government's gross debt receded to 75.8% of GDP in 2019 from 76.5% of GDP in 2018, driven particularly by BNDES reimbursements to the Treasury and falling international reserves, which added up to 2.8% of GDP in the year. Meanwhile, the public sector's net debt widened to 55.7% from 53.6% of GDP in the previous year. The nominal deficit narrowed to 5.9% of GDP from 7.1% in 2018, thanks to lower interest expenses and a better primary budget result. Following the approval of the pension reform, the focus must remain on revising mandatory expenses, such as personnel spending, in order to consolidate a scenario of gradual return to primary surpluses that are compatible with structural stabilization in public debt.
 

Pedro Schneider


For the version with all charts and tables, please open the attached pdf file



< Volver