Will Coronavirus Lead to Economic Collapse in Brazil?
The pandemic strikes Brazil during the greatest economic crisis in its history, with a weakened social structure, more than 10 million people unemployed and a weakened social protection network due to austerity policies. The country, however, has the instruments to mitigate the impacts of the crisis. It does not have a significant public external debt, it has foreign exchange reserves, and it has public banks and a consolidated social policy set of instruments. Paradoxically, the biggest obstacle to overcoming the crisis is the ideological belief in the free market and in austerity policies and the unjustifiable fear of public debt. The idea of deepening austerity policies in the immediate post-health crisis could lead Brazil to economic and social collapse.
Pedro Rossi, professor at the economics institute of the State University of Campinas