Carlos Kawall predicts recession in 2027 and calls for fiscal adjustment in Lula's government
Economist Carlos Kawall warns that Brazil may face recession in 2027 and advocates for a fiscal adjustment of 3% of GDP to control public debt and interest rates.
TL;DR
- Economist Carlos Kawall predicts Brazil may face stagnation or recession in 2027.
- He criticizes the current government's economic model, which relies on expanding public spending and increasing debt.
- The debt-to-GDP ratio has risen significantly, and high real interest rates are making credit expensive.
- Kawall dismisses proposals to artificially lower interest rates as ineffective and politically motivated.
- He recommends an urgent fiscal adjustment of 3% of GDP to stabilize the economy.
- Proposed fiscal measures include de-indexing certain expenses, reforming minimum wage policies, and a new pension reform.
- The private sector is expected to face challenges from expensive credit, increased labor costs, and new taxes.