Necessary actions to attract private investment did not take place, says economist

For economist Zeina Latif, the federal government it did not carry out the main actions necessary to attract private investment in Brazil. In an interview with CNN, she analyzed speeches by the Minister of Economy, Paulo Guedes, in which he said that the country has become a “paradise for entrepreneurs”.

“The advances are timid, the agenda associated with legal uncertainty ranges from the labor issue, to the tax issue, to the actions of the Court of Auditors, the Public Ministry, the Judiciary. point or another just that was worked. What it actually needs to attract private investment has unfortunately had little progress,” stated Latif.

The economist also commented on Guedes’ statement that Brazil grew above the world average during the pandemic, and that it would have surpassed forecasts.

“We had a quick recovery last year, the so-called V-shaped recovery happened, but when we look at the world comparison, we cannot say that we are above the world average”.

She claims that the country may have been featured in the Latin America, region whose Gross Domestic Product (START) contracted 7% in 2020, compared to 4% in Brazil. However, the group of emerging countries, of which Brazil is a part, had a 2% drop in GDP, less than the Brazilian.

Latif attributes the performance of Brazil’s economy to government stimulus actions, especially the emergency assistance. “We spend a lot, and in a country with so much pent-up demand, when it provides emergency aid, which is worthy but with a significant volume, the economy returns quickly”, he said.

One consequence she associates with higher public spending is high inflation, which is already above the world average. “[O aumento] will require interest rates taller too. There is no such thing as a miracle in economics.”

As for the minister’s comments on the search for “petrodollars”, in reference to investments by Arab countries that are large producers of Petroleum, Latif said that “we didn’t have a privatization agenda, it didn’t actually materialize, we had an important advance from the point of view of concessions, this has happened, it still has positive perspectives”,

“But each sector is a story, sometimes they attract foreign capital, but we are not talking about new investment in total. When estimating the inflow of resources in a sector, including oil and gas, it is not all new investment, sometimes it is acquisition. What we call new investment is a small portion, which does not mean that the country’s productive capacity or the supply of goods in the country is being expanded by this magnitude”, said the economist.