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Bolsonaro promises not to increase public spending and calls for investment in Brazil

The president of Brazil, Jair Bolsonaro, affirmed in a virtual meeting with investors that the government will be attentive to compliance with the law it imposes a ceiling on the growth of public spending and he promised to give continuity to the economic reform agenda.

« In the tax area, We will remain firmly committed to the ceiling (spending) rule« , said Bolsonaro during the opening of the Investment Conference in Latin America 2021, a virtual event promoted by the Credit Suisse bank.

In this way, the Brazilian president made a commitment to investors in guarantee tax balance, as well as advance in fiscal, tax and administrative reforms, in addition to promoting new concessions and privatizations.

Inflation and public spending

Bolsonaro said that despite the new coronavirus disease (COVID-19), he will remain committed to businessmen, investors and employees, being on the path of an expected growth of 3.5 percent in 2021.

The tax rule, established in 2016, prevents public spending from growing in one year above 12-month inflation accumulated until June of the previous year.

Economists warn that compliance with the measure it will be especially difficult in 2021 and that the situation of the health crisis makes the environment more complex.

For his part, the Minister of Economy, Paulo Guedes, said that the government monitors the behavior of the pandemic and that it can adopt new measures of social restriction if it considers it necessary.

Source: Xinhua