Half of Brazilians Are Middle Class, Finance Minister Announces

    Residence in Gramado, Brazil

    Residence in Gramado, Brazil The Brazilian economy should grow by approximately 4% in 2009, despite the global crisis and its effects on the country. The guarantee was given by the minister of Finance, Guido Mantega, who attended the 28th meeting of the Economic and Social Development Council, held this Thursday, November 6, at the Planalto Palace, seat of the federal government of Brazil.

    "In 2009, with all of the joint work between the private and public sectors, we will be perfectly able to ensure growth of around 4% for the Brazilian economy."

    The minister stated once again that Brazil is not going to escape the economic slowdown, but that still the domestic situation is better than in countries such as France or Italy. According to him, consumption is still going strong and there is enough "fat" to allow growth.

    "This is due to the emergence of a new middle class, which represents 50% of the population. We are witnessing the best primary surplus and the lowest deficit in public accounts in history," he said.

    Mantega also stated that the country has over US$ 200 billion in foreign exchange reserves, even after the Central Bank of Brazil intervened in the financial market. "This does not happen often. It is a sign of strength."

    The minister claimed that, in addition to foreign reserves, the Federal Reserve (Fed, the Central Bank of the United States) has made over US$ 30 billion available to Brazil, thus increasing the dollar reserves available to the country up to US$ 230 billion.

    We've already seen the worst of the crisis, according to Mantega. The situation, he says, passed the acute phase and at the end of October was already showing signs of cooling down.

    "Perhaps we can already see a light at the end of the tunnel. I just hope it's not  a locomotive coming from the opposite direction", said the minister, good-humored.

    ABr

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    • Show Comments (13)

    • Falupa

      Comments
      I can’t wait to see the comments on this one. I think the financial crisis is really going to hit this country harder than it looks to be. I am wondering what will happen to the economy six months from now. I just hope it won’t hurt businesses as bad as I am thinking.

    • VinnyCarioca

      Jon
      [quote]What are your thoughts on Obama..does he have the magic pill for the US economy?? Talk around here is he is a bigger protectionist that what he lets on to be[/quote]
      President-elect Obama has stated, in a past debate, that he would renegotiate NAFTA contracts. When Canadian officials contacted his economic team regarding that remark, it was conveyed to them that it was just political positioning.

    • João da Silva

      [quote]Hopefully he will be nice with the emerging nations….otherwise you will have to wait….[/quote]

      He is not going to be nice with “emerging” nations, unless they behave themselves. 😉

    • ch.c.

      Obama does not have a magic pill for the US economy and he does not have to have one either.
      He is like LULA !
      He was elected :
      – during a deep recession, collasping currency
      – and a 50 years low….on interests rates !

      As I said for LULA, even a monkey would have done good !
      Thus the same is for Obama !

      And He will get ALL the laurels.
      Re-election also guaranteed in 4 years !

      Hopefully he will be nice with the emerging nations….otherwise you will have to wait….. 8 years !
      Smiles

    • João da Silva

      Jon
      [quote]What are your thoughts on Obama..does he have the magic pill for the US economy?? Talk around here is he is a bigger protectionist that what he lets on to be[/quote]

      Thanks for asking my humble opinion. If you have been following the comments by Ch.C, Dnb, Ric, Vinny, Augustus, etc; (who are much better informed than myself), Obama does not have a magic pill for the US economy and he [i]does not have to have one either[/i]. The U.S. economy will repair by itself with a little bit of help from the Fed, the Arabs and probably the Chinese. It is an open economy where the foreigners can invest if they have plenty of dollars. Just like yours, except that you have much less a population and plenty of natural resources including oil.

      Under his [i]political [/i]leadership I foresee the following events to occur:

      1) End of “Gun Boat Diplomacy” practiced by GWB and dialogue between the U.S. and it is erstwhile “enemies”, thus opening up a tremendous opportunity to sell U.S technology.

      2) Waning of the influence of E.U, (as NAFTA is going to be a reality ) on rest of the world (including S.American countries).

      3) Tough trade negotiations to with “emerging” nations to lift trade barriers on essential goods and services.I think Obama is not really a “protectionist”, but will certainly endeavor to protect jobs in the U.S. (or export the skilled professionals to other countries).

      In general I have a good feeling about him. But the “Rulers” of LatAM countries are going to have a tough time to deal with him, in spite of the euphoria displayed by them.Alas, UNASUR is going to remain a dream. 😀

      It would be interesting to hear the opinion of our good friend Lord Augustus.!

    • jon

      Joao,
      The weather in the Great White North is not bad today actually, about 20C, thanks in part to global warming and our oil sands

      What are your thoughts on Obama..does he have the magic pill for the US economy?? Talk around here is he is a bigger protectionist that what he lets on to be

    • João da Silva

      Jon
      You interfering in our domestic affairs again, Jon ?

      Good to hear from ya. How is the weather up there in the Artics?

    • João da Silva

      Ch.C
      [quote]Only if and when the second to God decides.
      [/quote]

      When I said “If God willing”, I meant HIM! I am glad you got the drift of my thoughts. 😉

    • jon

      Ch C. , I would agree with that!

      Things just got worse today in the US with their job creation numbers or lack of…thousands of layoffs with more coming from Ford, etc

    • ch.c.

      Economists are like weathermen, they are half-right most of the time !
      Let me correct :
      Economists are right half the time !
      Politicians are WRONG 100 % of the time, when things are bad !!!
      As good for the USA, EU, China or Brazil, or whoever !

    • ch.c.

      By mid 2010, the other half also should be Middle Class, if God willing
      No.
      Only if and when the second to God decides.
      Lula proclaimed himself second to God !
      Lets see now by 2010 how HE is going to manipulate the Brazilian stats.
      😮

    • jon

      We have to watch in the next few months the economies of China and the US, the “engines” of global economic growth…they are reports in China of fairly large lay-offs and factory closures as demand wanes in the US for their products. If China falls off, there will be lower demand for commodities which will affect in turn the economies of Argentina, Brazil, Canada, etc. So again our economic leaders should be a little more cautious with their forecasts because this crisis has not played itself out yet. Economists are like weathermen, they are half-right most of the time….no offence Ch C…you did not get your degree from the bottom of a detergent pack 🙂 🙂

    • João da Silva

      [quote]Half of Brazilians Are Middle Class, Finance Minister Announces[/quote]

      By mid 2010, the other half also should be Middle Class, if God willing.

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