TMCnet - World's Largest Communications and Technology Community



DJ Goldman's O'Neill: Brazil Can Sustain 5% Annual Growth
[October 14, 2009]

DJ Goldman's O'Neill: Brazil Can Sustain 5% Annual Growth

SAO PAULO, Oct 14, 2009 (Dow Jones Commodities News Select via Comtex) -- Given the right mix of policies, Brazil can sustain average economic growth of 5% per year over the next ten years, Goldman Sachs economist Jim O'Neill said Wednesday.

"Brazil is in a very sweet spot," O'Neill told reporters during a Brazil tour. "Our projections show average growth for Brazil over the next ten years of 4.0% to 4.5%. But we're beginning to think it could be more like 5%." O'Neill is head of the Goldman Sachs global economic research unit. He is famed for coining the phrase BRIC nations in 2001. Under O'Neill's definition, the BRIC nations of Brazil, Russia, India and China are the leading emerging market countries, destined for sustained economic growth and increasing weight in world trade.

O'Neill said Brazil's ability to reach the 5% growth mark depends, in part, on results of next year's presidential election. Incumbent President Luiz Inacio Lula da Silva cannot seek a third four-year term.

"President Lula should be regarded as one of the most successful policy-makers in the world this decade," said O'Neill, pointing to adroit handling of monetary and fiscal policy as well as government efforts to attract foreign investment.

"Much of this success is based on policies that keep inflation stable and low," said O'Neill. "This has allowed Brazilians to plan and to invest. If Brazil's next leader builds on this strong groundwork, he or she will be able to bring Brazil to a new level of growth." According to political scientists, the 2010 presidential election is shaping up as a contest between President Lula's hand-picked candidate, presidential chief-of-staff Dilma Rousseff, and opposition Social Democrat Jose Serra, now serving as governor of Brazil's biggest state of Sao Paulo.

Rousseff has pledged to continue President Lula's policies. Serra has not yet declared his candidacy. A trained economist, Serra has defended greater government intervention in the economy, including massive infrastructure investments and lower interest rates.

O'Neill declined to discuss individual Brazilian candidates or political platforms. However, he said "the right mix of policies" was needed to ramp up growth.

O'Neill said Brazil's next president would have to address three major weaknesses in Brazil's current position. "These are the comparatively low percentage of GDP dedicated to investment, a business environment that is comparatively protected in relation to the rest of the world, and relatively high government spending as a percentage of GDP," said O'Neill.

-By Tom Murphy, Dow Jones Newswires; 55-11-2847-4519; (END) Dow Jones Newswires 10-14-09 1256ET

[ Back To's Homepage ]

Technology Marketing Corporation

35 Nutmeg Drive Suite 340, Trumbull, Connecticut 06611 USA
Ph: 800-243-6002, 203-852-6800
Fx: 203-866-3326

General comments:
Comments about this site:


© 2019 Technology Marketing Corporation. All rights reserved | Privacy Policy