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As fires continue to destroy its tropical forests, Brazil is escaping the economic recession. In the second quarter, its GDP grew by 0.4%. The eighth largest economy in the world is doing poorly.
After a sluggish start to the year, Brazil is recovering slightly from the hair of the beast. But the aftermath of the 2016 crisis is still there. After the worst recession in its history , the country has been living at a rate of weak growth for three years.
President Jair Bolsonaro came to power in January and promised a liberal economic policy. Financial markets, initially enthusiastic, have quickly disillusioned.
Foreign investors are still very cautious and await the outcome of the vote on the crucial pension reform. This reform, which must put an end to an extremely costly regime for public finances, is currently being discussed in the Senate.
The effects of the US-China trade war
The Brazilian economy is also suffering the effects of the global economic slowdown caused by the US-China trade war.
The EU-Mercosur Free Trade Agreement does not help matters either. The signatory countries are dragging their feet. Brasilia counts a lot, but the treaty is threatened with rejection by France in open crisis with Jair Bolsonaro on its fire management in the Amazon.