Estudios económicos


Population 204,459 million
GDP 8 669 US$
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major macro economic indicators

  2014 2015  2016(f) 2017(f)
GDP growth (%) 0.5 -3.8 -3.6 0.4
Inflation (yearly average) (%) 6.3 9.0 8.7 4.4
Budget balance (% GDP) -6.0 -10.3 -9.0 -9.1
Current account balance (% GDP) -4.2 -3.3 -1.3 -1.4
Public debt (% GDP) 62.3 72.5 78.3 81.2


(f) Forecast


  • Improved institutional transparency following recent corruption scandals
  • Increasing active population
  • Varied and rich mineral resources and agricultural harvests
  • Advanced manufacturing industry: aeronautics, chemistry, pharmaceuticals, oil and gas industry engineering
  • Ability to withstand external shocks: creditor to outside world, substantial reserves


  • Shortages of qualified labour / inadequate education system
  • Infrastructure shortcoming (transport, energy)
  • Low level of investment
  • High cost of production (wages, energy, logistics, credit)
  • Public spending is high and inefficient
  • Scale of corruption and inequalities

Risk assessment

Slow recovery in activity in 2017

Brazil has experienced an unprecedented economic and political crisis, with two successive years of recession (2015–2016). In 2017, the economy is expected to gradually move into growth, which increased by 1% in the first quarter of 2017 (QoQ), for the first time in 2 years, largely based on the agriculture sector. The fall in inflation (3.6% YoY in May, a near 10-year low), progress on the budget reforms and the as yet slow recovery in economic activity should lead to a gradual reduction in interest rates: in order to promote borrowing and to reduce debt servicing costs, the Central Bank cut the Selic rate by 400 bp. since December 2016 (10.25% since May 31st). The reduction of macroeconomic imbalances and the recovering confidence within the industrial and services sectors should increase investments. Foreign trade should contribute to growth thanks to the vitality of exports (particularly primary) and the moderation of imports.

Despite the falling inflation, and the February 2017 measure allowing employees who resigned or have been dismissed before December 31, 2015, to draw on their Working Time Guarantee Fund (FGTS), household consumption is likely to continue suffering from the high level of unemployment, up one percentage point since the beginning of the year (13.6% in the first quarter).


The government wants to cut the public accounts deficit

The public deficit is likely to contract as the reforms being undertaken by the government of President Michel Temer are implemented. On coming to power in May 2016, the president announced a budget readjustment plan aimed at slowing the public spending growth. Several measures were suggested, in particular an amendment to the Constitution (PEC) intended to set a ceiling for increases in spending. The PEC was approved on the first vote in the Chamber of Deputies and in the Senate at the end of 2016. In 2017, the government’s political agenda focuses on reforming the retirement system, including longer working lives period with a minimum legal retirement age raised to 65. The reform of the labour code, including a relaxation in the working time, is also on the political agenda. However, their implementation will depend on the political situation. In the shorter term, the recovery in economic activity, slow as it may be, should help the government stop the decline in its revenues resulting from the economic contraction. All of these initiatives are aimed at reducing public deficit and, consequently, slow the growth in the public debt. Indeed, the speed of the public debt growth is a cause of concern and is costly, notably in terms of external creditworthiness. In May 2017, Standard & Poor’s downgraded it into junk territory, due to political risks. The risk associated with the external public debt is however limited (75% of the debt is held by residents) and the level of the currency reserves (19% of GDP) limit the danger of a currency crisis. The Dollar appreciation could however weigh on the réal exchange rate during the year, despite a gradual re-emergence of confidence in the country among investors.

In terms of foreign trade, the current account has been in surplus in March, the first in almost 8 years, with an increase in exports above the increase in imports. Yet, the rise of the US dollar and the low level of household demand are likely to negatively affect imports. Exports should be backed by the vitality of the agricultural (most notably soya) and livestock sectors, as well as, to a lesser extent, exports of manufactured products which will benefit from the weakness of the réal and the gradual upturn in regional demand. This should also lead to an increase in exports of services (mainly transports) to neighbouring countries.


Michel Temer facing corruption scandals

Officially appointed Brazilian Head of State at the end of August 2016, following the impeachment of Dilma Rouseff, his predecessor, Michel Temer faces an investigation of the Supreme Court for passive bribery, obstruction of justice and participation in a criminal organization. Revelations of corruption related to the judicial operation "Lava Jato", involving a large number of legislators and ministers, could lead to the indictment of the president. Nevertheless, on June, 9th 2017, after 4 days of debate on the regularity of the 2014 campaign accounts, the Electoral Court voted 4 to 3 against the motion that would have terminated Temer’s mandate.

In economic terms, the president wants to adopt more orthodox policies and ones that are more favourable to business than those of his predecessors, with a focus on budget management. These conventional policy measures (reforms to pensions and the labour laws) are however likely to weaken the already extremely shaky popularity of the government, and could be thwarted by the several corruption cases.

The foreign policy is expected to focus on building the country’s exports and on its strategic partnerships with Argentina, China and the United States.

Last update: June 2017



Bills of exchange (letra de câmbio) and, to a lesser extent, promissory notes (nota promissória) are especially used in local commercial transactions. The validity of either instrument requires a degree of formalism in their issuance.


The use of cheques is relatively commonplace – often post-dated in practice and thus transformed into credit payment instruments – and their issuance requires comparable formalism.


Although the use of the above credit payment instruments for international settlements is not advisable, they nonetheless represent, in case of default, an effective means of pressure constituting an extra-legal enforcement title that affords creditors with privileged access to enforcement proceedings.


Theduplicata mercantil, a specific payment instrument, is a copy of the original invoice presented by the supplier to the customer within a 30 days time for acceptance and signature and then can circulate as an enforceable credit instrument.


Bank transfers, sometimes guaranteed by a standby letter of credit, are also commonly used for payments in domestic and foreign transactions, offering relatively flexible settlement processing particularly via the SWIFT electronic network to which major Brazilian banks are connected.


For moving large sums, various highly automated interbank transfer systems are available like, since April 2002, the STR real time Interbank Fund Transfer System (Sistema de Transferência de Reservas) managed by Banco Central do Brasil or the RSFN / National Financial System Network (Rede do Sistema Financeiro Nacional) linking various financial operators in Brazil in real time.


Debt collection


Out-of-court settlement begins with telephone contacts followed up as necessary with a final demand by recorded delivery letter requesting debtor to pay the outstanding principal, increased by past-due interest stipulated in the transaction agreement. Absent an interest-rate clause, the civil code stipulates use of the penalty interest rate imposed on tax payments, which is one per cent per month past due.


Considering the slow pace and the cost of legal proceedings, it is always advisable to negotiate directly with delinquent customers where possible and attempt to settle on amicable basis, taking into consideration that a repayment plan may last for a two years period. If the negotiation in amicable basis was not successful, the debt can be claimed in Court.


The legal system comprises two types of jurisdiction the first of which is at the State level.


Each Brazilian State has its own courts – there are 26 States, plus theDistrito Federalof Brasilia – notably including a Court of Justice (Tribunal de Justiça) whose judgments can be appealed at the Federal level. Legal costs vary from State to State.


The second type of jurisdiction involves the Federal Courts. There are five regional Federal Courts (Tribunais Regionais Federais / TRF), each with its own geographic competence encompassing several States. The five TRF are located respectively in Brasilia (região 1), Rio de Janeiro (região 2), São Paulo (região 3), Porto Alegre (região 4), and Recife (região 5).


For recourse on no-constitutional questions, TRF judgments can be appealed to the highest court of law, the Superior Tribunal de Justiça / STJ that sits inBrasilia.


Brazilian law provides a wide range of legal measures to be used in defense of the rights of creditor against debtor. Six collection legal procedures are most commonly used:Processo de Execução(which is our main Enforcement Proceeding),Ação Monitória(which is a hybrid of an Enforcement Proceeding and a Standard Lawsuit),Ação Ordinária de Cobrança(Standard Lawsuit),Reintegração de Posse de Bem com Reserva de Domínio(Enforcement of a Retention of Title),Pedido de Falência(Bankruptcy Request) andCautelar de Arresto(which is a Preemptive Seizure of Assets).


The enforcement of an extrajudicial instrument is a legal type of enforcement granted to the creditor in order to allow him to claim his rights against the debtor and is the most direct and effective in courtvehicle to recover credits in Brazil, and does not require prior guarantees from foreign creditors.


Brazilian legislation moreover makes some documents enforceable, that are separated in two main categories :


legal enforcement titles including judgments made by a local court recognizing the existence of a contractual obligation, court-approved conciliations, arbitral awards, and foreign judgments covered by anexequatur,

extra-legal enforcement titles : bills of exchange, promissory notes,duplicata mercantil, cheques, official documents signed by the debtor, private agreements signed by debtor, creditor and two witnesses (obligatory), secured agreements, and so on.


The estimated duration of the proceeding is in average 1 year in the main States to reach a judgement on the matter.


The ação monitória is a special procedure that can be filed by any creditor with written proof of debtor's obligation that is not enforceable.The difference between this procedure and the Enforcement Proceeding is in the legal requirements and in the possibility of questioning the merit of the obligational relationship by the debtor in the course of the suit. Theação monitória is less speedy than a regular Enforcement Proceeding because if debtor presents an objection in the Court, the merits of the commercial relation will be thoroughly discussed in the same fashion of a Standard Lawsuit.


The estimated period of this lawsuit is on average 2 years.


Ordinary proceedings, presided over by an interrogating judge (inquisitorial procedure), are often formalist, because on this lawsuit will be done a scrupulous examination of evidence submitted by each party in conjunction with study of any expert reports ; finally, the main hearing during which the respective parties are heard  and after this the judgment will be made by the court.  It takes two to three years to obtain an enforceable judgment in first instance.


Enforcement of a Retention of Title It is a special procedure based on the retention of title of a  movable non-fungible asset, which remains until the agreed price is fully paid.


Bankruptcy Request (Chapter 7) - is a procedure that may ultimately be used as a way to pressure the debtor to execute an agreement, However, it cannot be overlooked, because it is one of the main courses of action in credit recovering.


The Precautionary Seizure represents a lien on the debtor's assets. Its purpose is to protect the assets from fraud against creditors or squandering promoted by the debtor.


The article 835 of the CPC establishes that, except in enforcement proceedings based on extrajudicial

enforceable instruments, the plaintiff, national or foreign, who resides abroad or leave Brazil during the course of the lawsuit, has to provide a bond in court with a security sufficient to pay the judicial expenses and the attorney's fees of the opposing party, unless it possesses real estate in Brazil in a value that ensures such payments. The purpose of this legal requirement is to protect any possible harm to the defendant or to the court in the case of defeat of the foreign plaintiff abroad, since, if it worked otherwise, it would create a costly obligation to start a collection abroad against the plaintiff for the judicial expenses or the Defeat fees. The value of the bond is up to 20% of the claim value, but it is usually smaller in collections of higher value (between 5% and 15%). The security can be provided either by the plaintiff or by a third party on its behalf.

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