MercoPress. South Atlantic News Agency

Zero growth in Brazil - Argentine trade surplus

Brazil's GDP barely increased 0,03% during the last twelve months, quiet distant from the 1 to 2% analysts predicted.Argentina experienced a 1,398 billion US dollar trade surplus during July, bringing the seven months total to 9,573 billion US dollars.

According to the Brazilian Geographic and Statistics Institute, in the last twelve months industry actually contracted 2,8%, while agriculture increased 5,32% and services 1,74%. In the second quarter Brazil's GDP increased 0.99% and in the six months to June, 0,61% compared to similar periods a year ago. "It's almost certain Brazil's industry will end 2002 with zero growth", indicated the Brazilian Confederation of Industry, CNI. "A deterioration of business climate, uncertainties related to the electoral scenario and associated financial turbulence forced the foreign exchange rate and interrupted the fall in interest rates", adds CNI. Prime interest rate in Brazil is 18%, one of the three highest in the world. Brazil's foreign and internal debt currently stands at 819 billion Reales, equivalent to 62% of the country's GDP, with a dramatic jump of 70 billion Reales in July, mainly because Brazilian bonds are indexed to the US dollar. Although the US dollar in Brazil now quotes at 3,02 Reales, just a few weeks ago in the midst of financial turbulence before the IMF financial assistance announcement, the green back was selling at 3,30 Reales.

Argentine trade surplus

Argentina experienced a 1,398 billion US dollar trade surplus during July, bringing the seven months total to 9,573 billion US dollars. According to the Argentine Statistics Office, July exports reached 2,211 billion, 6% less than in 2001, and imports 813 million, a 54% drop compared to a year ago. In the first seven months of 2001, Argentina managed a trade surplus of 2,457 billion US dollars. A drastic contraction of imports and a sustained rate of exports, with strong prices for cereals and oil seeds, have helped Argentina obtain a considerable surplus.