After the IBGE announced today that Brazil's GDP fell 0.2% in the first quarter, in its first decline since 2016, analysts are now saying the government has to take urgent steps to recover the economy, but even if all of this done the recovery of the Brazilian economy should only happen in 2020 because by 2019 the situation should not improve. Employment, for example, may get worse than in 2018.
According to José Luis Oreiro, professor of economics at the University of Brasília (UnB), "2019 is a year that we already lost. It is a year of very low growth, I think that 1% is the growth forecast ceiling for 2019 but it's going to be less than that. We can get out of this? Yes, but we (the government) have to create aggregate demand stimuli".
In the evaluation of the economist José Roberto Mendonça de Barros, founder of MB Associados, 2019 is a lost year for the economy. According to him, the current administration did not have the political ability to make the ideal Pension Reform in the early months of 2019. Now, the most optimistic prediction is that the Pension Reform should only be voted by the end of the year.
There are also economists who already speak of a "recession smell," such as Zeina Latif of XP, or that Brazil would already be in a "possible technical recession," according to Sérgio Vale of MB Associados.
Many analysts, who at the beginning of the year were betting heavily on the current government, now say that Brazil's economic momentum is very bad, that government performance is discouraging and that the economy stands at a low point and with no expectation of growth.
