President Jair Bolsonaro said on Tuesday (26) that emergency aid will not be extended in 2021. During his speech, aimed mainly at foreign investors, the government official guaranteed that he will respect the expenditure ceiling. The decision goes against popular pressure, which has manifested itself in favor of paying new installments in the face of the worsening pandemic in the country.
“We are not going to let temporary measures related to the crisis become permanent spending commitments, our goal is to move from recovery based on support for consumption to sustainable growth,” he said at a Credit Suisse event via videoconference, alongside the Minister for the Economy, Paulo Guedes, and the head of Foreign Affairs, Ernesto Araújo.
After Bolsonaro, Guedes said that instead of paying the benefit, the government could freeze spending and increase wages during the disease’s progress. “It is an acute case of public calamity.”
Emergency aid will not be extended
In his speech, the president guaranteed that, “despite the covid”, the commitment to investors, entrepreneurs and employees will be maintained. According to him, the government will not exceed the spending ceiling, instituted in 2016. In general, the fiscal rule prevents expenditures in one year from exceeding the 12-month inflation accumulated up to June of the previous year.
Economists believe that it will be a great challenge to fulfill this promise in 2021. After all, Brazil is experiencing not only a health crisis, but also an economic one. Between August and October 2020, the unemployment rate was 14.3%, reaching 14.1 million people. The estimate, however, is that the index will rise to 17% this year.
Among other information disclosed during the event, the president also promised to accelerate privatizations, “with long-term strategies, low risk and attractive and stable rates”. According to him, the country will have very favorable conditions to inject money in 2021.