Brazils recession worst on record

Brazil is indeed experiencing its worst recession on record. Here are some key facts:

  1. Duration: The recession started in 2014 and has been ongoing for over 5 years, making it the longest and deepest recession in Brazil's history.
  2. GDP contraction: The Brazilian economy contracted by 3.6% in 2015, 3.8% in 2016, and 3.5% in 2017. In 2018, the economy contracted by 0.1%, and in 2019, it contracted by 0.3%.
  3. Unemployment: Unemployment rates have risen significantly, reaching a record high of 12.7% in 2016. As of 2020, the unemployment rate is around 11.8%.
  4. Inflation: Inflation has been a major concern, with the country experiencing a high inflation rate of 10.7% in 2016. Although inflation has decreased since then, it remains above the central bank's target of 3.5%.
  5. Causes: The recession was triggered by a combination of factors, including:
    • A severe drought in 2014, which affected agricultural production and led to a decline in exports.
    • A decline in commodity prices, particularly in oil and iron ore, which reduced government revenue.
    • Political instability and corruption scandals, which led to a decline in investor confidence.
    • A currency crisis, which led to a sharp depreciation of the Brazilian real against the US dollar.
  6. Impact: The recession has had a significant impact on various sectors, including:
    • Industry: Production has declined, and many companies have gone bankrupt or reduced operations.
    • Agriculture: The sector has been affected by the drought and declining commodity prices.
    • Services: The recession has led to a decline in consumer spending and investment.
    • Poverty: The recession has exacerbated poverty and income inequality, with many Brazilians struggling to make ends meet.
  7. Recovery: The Brazilian economy is expected to recover slowly, with the International Monetary Fund (IMF) predicting a growth rate of 1.2% in 2020. However, the recovery is expected to be fragile and dependent on various factors, including the country's ability to implement structural reforms and improve its business environment.

Overall, Brazil's recession has been a significant challenge for the country, and its impact will likely be felt for years to come.