Brazilian Finance minister Guido Mantega admitted before the Senate that the global financial crisis is already having an impact in the local economy and this will be reflected in a lower GDP for the twelve months.
“Although we are still working on our original forecast of 4.5% for 2011, we believe a more accurate figure is 4%, which is not bad for a transition year”, Mantega told Brazilian Senators.
He also recalled that the Brazilian government in the last months has been adopting a package of measures geared to avoid an over-heating of the economy, which also contributes to contract activity and the forecasted GDP.
However if the Brazilian economy were to ‘cool’ further than expected, the government is ready to intervene with “different tools”, which he did not detail, to prop the GDP.
“We won’t let the economy fall and we will take the necessary measures so that GDP continues to expand, but under control”, said the Minister.
Mantega also added he was convinced the slower global economic pace would not affect ‘significantly’ the employment rate and job creation of the country.
“Brazil is one of those countries which has managed to create more jobs in the world, at least proportionally” said Mantega although immediately adding that it is ‘only natural’ that this year ‘less jobs than in 2010 will be created’, when a record 2.5 million