Brazil 2017 fiscal target also expected negative

Finance Minister Henrique Meirelles noted today (Jun. 29) that Brazil is going through a tough fiscal scenario, for both the federal government and the states, with little room for investment. It is possible, however, to reverse the present situation by restoring growth among investors and consumers by taking a “realistic” approach and telling the truth about the figures in the economy, the minister argued.

He pointed out that the fiscal target for next year will also be negative, and refrained from talking about figures in advance. “We must tell the truth and say what the reality is. We're making calculations and bringing forward the steps for reversing this scenario. That's what matters the most.” According to the minister, the government is expected to submit to Congress a series of new parameters for the 2017 Bill for Budgetary Guidelines next week.

Meirelles spoke during the opening ceremony of the 6th International Seminar on Administrative Law and Public Administration. He once again advocated the constitutional amendment bill setting a limit to public spending, currently under consideration in Congress. Attempting to describe the fiscal landscape as being better than it really is will be of no use, the minister declared.

Meirelles highlighted that the confidence curve in the Brazilian economy, which has been on the wane in the last few years and progressively lowered all confidence levels, is now showing signs of recovery. “[It] shows we're in the right direction. We'll be tenacious. We trust that the economy will pick up again in due time,” he said.

Also at the seminar was acting Planning Minister Dyogo Oliveira, who showed support for Meirelles's stance and also stressed that the changes are made clear by the expectations of foreign investors. After leaving the gathering, Oliveira told journalists that the 2017 deficit is likely to surpass $30 billion.

The 2017 Bill for Budgetary Guidelines currently in Congress estimates a surplus of zero reais. The new parameters for the bill are expected to reach Congress by June.

Translated by Fabrício Ferreira