## Brazil: 2020 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Brazil

_IMF Staff Country Reports, December 2, 2020_

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## Bibliographic details
- Published: December 2, 2020
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513562674.002

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### Pandemic impact and structural vulnerabilities
- The COVID-19 pandemic has worsened Brazil’s longstanding vulnerabilities of low potential growth, high income inequality, and weak fiscal position.
- The authorities mounted a rapid and effective response to support the economy and protect the poor and vulnerable.
- The virus outbreak is yet to be brought under control.

### Outlook and macroeconomic projections
- Real GDP is projected to contract by 5.8 percent in 2020.
- Real GDP is projected to recover to 2.8 percent in 2021.
- With weak domestic demand, inflation is likely to end 2020 substantially below target.

### Public debt and fiscal outlook
- Debt is projected to jump to 100 percent of GDP.
- The debt increase is due to a 10.6 percentage point deterioration in the primary deficit in 2020.
- Debt is projected to continue to rise over the next five years.
- The high level of debt exposes Brazil to confidence shocks.

### Policy challenges and reform prospects
- Securing congressional passage of structural reforms to raise potential growth remains challenging.
- Authorities’ rapid fiscal and social response helped protect vulnerable groups, but longer-term measures are needed to address weak potential growth and fiscal sustainability.

*Source: Brazil: 2020 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Brazil (IMF Staff Country Report No. 2020/311).*

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_Source: https://www.imf.org/en/publications/cr/issues/2020/12/01/brazil-2020-article-iv-consultation-press-release-staff-report-and-statement-by-the-49927_