Brazil govt sets $41.63bn primary deficit for 2017
Brazil's 2017 fiscal target has been set at a $41.63 billion primary deficit, Finance Minister Henrique Meirelles announced Thursday (Jul. 7). According to him, efforts to stay within this target means the government will not only need to cut costs, but also to obtain additional revenue through concession contracts and sale of assets, award oil fields for development, and possibly increase taxes.
In addition to the federal deficit, there will be other budget gaps in the primary targets set for state owned companies ($900 million) and states and municipalities ($330 million). Considering these, the total deficit increases to $42.86 billion.
“We need to address the continual increases in federal spending in the past two decades. We had to consider efforts focused particularly on spending [cuts] and expanding revenue,” Meirelles said. Without this additional revenue, the deficit would stand at $58 billion if mandatory costs were to keep the growth trend from recent years.
The primary deficit is a negative balance in the government accounts before interest payments on the debt. The 2017 budget directive (LDO) bill submitted to Congress in April will be amended to incorporate the new deficit target.
With the new fiscal target set for next year, 2017 will be the fourth consecutive fiscal year Brazil faces a budget gap.
Translated by Mayra Borges
Fonte: Brazil govt sets $41.63bn primary deficit for 2017
