Pandemic lowers foreign investment in Brazil
The crisis brought about by the pandemic of the novel coronavirus (COVID-19) has led to a reduction in foreign investment in the productive sector. Investment in shares, bonds, and investment funds, in turn, shows signs of a reaction, according to data released by the Central Bank today (Nov. 25).
Net amounts coming as direct investment into the country, which go towards the productive sector of the economy, added up to $1.793 billion last month, compared to $8.221 billion in October 2019.
From January to October, direct investment reached $31.914 billion, against $57.615 billion in the ten months of 2019, down 44.6 percent.
In the 12 month ending in October 2020, direct investment totaled $43.5 billion—2.94 percent of the GDP—compared to $49.9 billion—3.29 percent of the GDP—in the 12 months leading to September this year.
According to head of the Central Bank’s Statistics Department Fernando Rocha, the uncertainties regarding the duration of the crisis caused by the new coronavirus make foreign investors postpone their plans of bringing funds to the country. “The postponement is for them to wait until uncertainties are mitigated regarding whether there will be a second wave, whether contamination will be reduced, and when an efficient vaccine is due to be available,” Rocha argued.
