MercoPress. South Atlantic News Agency

Corporate cuts cost Brazil 70.000 jobs and 27.8 billion USD

Brazil is estimated to have lost the equivalent of 27.8 billion US dollars in investments from domestic and international corporations as a direct consequence of the global recession, according to press reports from Sao Paulo.

More specifically this refers to 46 large projects from 32 corporations which had plans to execute investments in the next four years, but which now have been cancelled or postponed, said O'Globo from Rio do Janeiro. This includes investments in such basic sectors as steel, mining, construction, sugar and ethanol processing plants, energy plants and harbour infrastructure. Those hit particularly hard are those directly linked to commodities, the basis of the Brazilian boom and which have suffered the most following the collapse of international demand caused by recession in developed countries and the back fall of Chinese demand. Steel and mining have suffered cut backs to the tune of 12.3 billion US dollars. Vale do Rio Doce, world leader in iron ore exports and other minerals and the largest private corporation in Brazil has cut or frozen several projects or forced technical stoppages and staff vacations to make supply meet demand. Earlier this month the corporation announced the cancelling of a new 5.5 billion US dollars steel foundry in the state of Espirito Santo in association with China's Baosteel. The plant was expected to produce 5 million tons of steel annually and create 3.000 permanent jobs. The cut back or freezing of projects also has a direct impact on jobs, 70.000 less than forecasted, a growing headache for the administration of President Lula da Silva.