Brazilian economy was flat in third quarter


Brasilia : Brazil’s economy appears to have stalled in the third quarter, the country’s deputy finance minister said Tuesday, while predicting a return to growth in the final three months of 2011.

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Stagnation of Latin America’s largest economy between July and September was “within government projections” and can be attributed to “internal and external shocks”, Nelson Barbosa said in comments cited by the official Agencia Brasil news service.

With the slowdown, growth estimates for this year are left between 3.2 percent and 3.8 percent, he said in presenting the balance of the second phase of the Growth Acceleration Program, an ambitious plan of infrastructure works for the coming years.

For Barbosa, the economy’s doldrums are a consequence of an international scenario marked by crises in European countries, and of measures adopted by the Brazilian government to curb deficits and contain inflation.

“Several measures had been adopted to spur growth next year,” he said, such as increasing the minimum wage and an easing of the tax burden.

The government projects gross domestic product growth in 2012 of 4 percent, but with “new actions” being taken by the administration of President Dilma Rousseff, the economy could see a 5 percent surge, Barbosa said.

“To reach 5 percent depends on the actions being taken by the government, which has the duty to guide our expectations, and so we are hoping for a new expansion of public investment in 2012 and a neutral tax policy,” the deputy minister said.