See other moments when the Brazilian economy had a technical recession

The Brazilian economy retreated 0.1% in the third quarter of 2021 and experienced a technical recession, which occurs when there is a decline for two consecutive quarters.

According to the historical series of the IBGE (Brazilian Institute of Geography and Statistics), which began in 1996, the first technical recession occurred in 2001, pressured by the crisis in Argentina and the attacks in the United States. Two years later, the country would face negative again, as explained by CNN economic analyst Priscila Yazbek.

Brazil did not go into technical recession for five years after 2003, but was hit by the global financial crisis, which began in the United States in 2008 and saw the scenario repeat itself in 2009.

At the end of 2015 and beginning of 2016, the Brazilian economy retreated again. The slowdown in commodities, price repression, high inflation and low interest rates have pushed the country back into recession.

In 2020, with the pandemic of the new coronavirus, Brazil again showed contraction. The first quarter of the year showed a drop of 2.3%, while the second quarter had a more gross drop, of almost 9%.

Technical recession in 2021

In the first quarter of the year, GDP — which represents the sum of all the country’s wealth — grew by 1.2%. In the following period, it fell by 0.4%, according to a review released by the institute. In the third quarter, the retreat was 0.1%.

The Economy Minister, Paulo Guedes, and the economic policy secretary at the Economy Ministry, Adolfo Sachsida, attributed the drop in GDP to agribusiness.

“It was an accident on the way, a chance, like rain, wind. One sector had a fall [agronegócio]. For the next month, the effect of this passes, it is transitory. The headache is much greater with inflation,” said Paulo Guedes, to CNN.

“More important than the GDP number is looking at the quality of growth. Agro fell by 8% in the period, in the biggest water crisis in history. When we isolate this loss, we see that GDP would have been positive by 0.3% in the third quarter”, said Sachsida, to CNN.

In a ranking by Austing Rating, which encompasses 33 countries, Brazil’s GDP is in the 26th position with the lowest growth among the analyzed economies. For Priscila Yazbek, this shows that the result presented is not a result of monitoring the world economy.

Agriculture is the smallest portion represented by GDP, with a 6.80% share. Services (72.80%) and industry (20.40%) make up the largest share.