Brazil and Argentina bottom of the list in terms of competitiveness
Brazil ranks near the bottom among fourteen emerging powers in terms of competitiveness, due to high capital and labor costs as well as inadequate infrastructure, according to a study commissioned by the National Confederation of Industry (CNI) and published by the Folha de Sao Paulo daily.
According to the report Brazil is in 13th place ahead only of Argentina among fourteen countries with similar socio-economic characteristics. Canada ranked first, followed by South Korea, Australia, China, Spain, India, Chile, South Africa, Poland, Russia, Colombia and Mexico.
The study indicated that there was no improvement in Brazil's standing since a similar survey done in 2010.
The world's sixth largest economy, which is currently showing anemic growth, fared worst in the area of labor and capital costs, infrastructure and transport, and macro-economic environment.
The foreign trade ministry said last week that the country posted a 186 million dollars trade deficit in November, down from a surplus of 571 million during the same month of 2011.
Between January and November, Brazil recorded a surplus of 17.18 billion, down 33.9% compared with the same period 12 months ago.
In November, exports totaled 20.47 billion, down 6% compared with a year earlier but up 3.5% compared with October, the ministry said.
Folha quoted Renato da Fonseca, CNI executive-manager, as saying that this explains why Brazilian industry is losing markets abroad.
”The (global crisis) affected everybody, but impacted Brazilian industry with great intensity, he said. At a time of crisis, competition becomes more acute and it is precisely the moment when the country needs to show strength so as not to lose markets.”
The Brazilian government has said it hopes its recent measures to boost industry and consumption will bear fruit in the second half of this year, but companies have stressed the urgent need for structural reforms.
Confirming the report eeconomists’ lowered their growth forecasts for Brazil for this year and next for the fifth consecutive week, due to poor economic performance this year, showed a weekly survey by the central bank Monday.
GDP is likely to grow 1% in 2012, rather than 1.03% forecast in last week's survey. Growth in 2013 is likely to be 3.4% rather than 3.5%. The survey tracks the forecasts of 100 analysts and economists and reports the averages.
Respondents saw inflation as likely ending the year at 5.60% rather than 5.58%, and at 5.42% next year rather than 5.40%.
The average forecasts for the benchmark Selic rate this year and next remained at 7.25%. That for the debt-to-GDP ratio likewise stayed put, at 35.1%.
The forecast for this year's trade surplus was 19.50 billion from 20 billion, and that for the current-account deficit was 54 billion. Respondents saw the U.S. dollar ending the year at 2.08 Reais.