The chronic deficit has put pressure on public debt and is driven by increased spending on social security, health care and education;
After overcoming successive currency crises, the Brazil has faced challenges in the last ten years public accountswith queue deficit and increase in public debtworsened by previous economic policies. Today the country is facing a crisis of confidence that devalues the real, scares investments, puts pressure on inflation and leads the country to have higher interest rates.
According to experts, the main causes that explain this chronic problem are: the high expenditure for Social security, high expenses with public employees, tax burden well above the average of other emerging countries and new pressures in items such as the benefit of continuous payment (BPC) and minimum levels of health and education.
The economic team led by Fernando Haddad has sought to recover revenues as a strategy to reduce the deficit. So far, the measures have been insufficient and economists stress the urgency for the government to establish an effective policy of spending reduction? an agenda that is meeting resistance from President Lula and the political wing of the government. Read the full report to learn more: Understand in 9 graphs where the public accounts deficit comes from and how it hinders the country’s growth.
Source: Terra
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