Skipping Carnival is more expensive in 2023; understand

After two years of restrictions and cancellations due to the pandemic, the return of official Carnival blocks should be accompanied by high prices in Brazilian metropolises.

This is what a survey carried out by economist André Braz, from FGV Ibre (Brazilian Institute of Economics of the Getulio Vargas Foundation), at the request of the Sheet.

According to the analysis, Carnival inflation accumulated a high of 14.58% in the 12 months up to January. The basket covers 21 items that are usually consumed by revelers and that are part of the IPC-S (Consumer Price Index – Weekly).

In the same period, the IPC-S advanced 4.3% in general terms. The index is calculated by FGV Ibre in seven capitals (Belo Horizonte, Brasília, Porto Alegre, Recife, Rio de Janeiro, São Paulo and Salvador), all of which have a tradition of Carnival parties.

“Most of Carnival prices rose above average inflation. Those who are exposed to these expenses will spend more”, says Braz.

According to the researcher, a considerable part of the Carnival basket became more expensive due to the resumption of demand in recent months.

Of the 21 items in the Carnival basket prepared by Braz, airfare had the highest rise in the last 12 months: 46.49%. Airline tickets had the greatest impact on revelers’ basket inflation.

Transport by application, in turn, rose 10.84%, the second largest variation, followed by hotel prices (10.75%).

Next, taxi fares (8.94%), sweets and snacks (8.86%), other alcoholic beverages (8.76%), meals in bars and restaurants (8.52%), fruit juices ( 7.76%), soft drinks and mineral water (7.67%) and out-of-home ice cream (7.55%).

Beer and draft beer did not escape the scarcity either. In the last 12 months, the prices of these items advanced 7.40% outside the home, according to the survey.

“There is a demand component in the Carnival basket. Hotels, taxis and transport by app, for example, were not used so much before, people were not traveling in the pandemic. Hotels were even closed. Afterwards, the demand became more heated”, says Braz.

Tourism is yet to catch up to pre-pandemic

The last Carnival before the health crisis took place in early 2020. The pandemic, which started shortly thereafter, in the same year, led to restrictions on mobility. Official blocks were canceled in 2021 and 2022.

In 2023, Carnival should move BRL 8.18 billion in Brazilian tourism, according to a projection by the CNC (National Confederation of Commerce in Goods, Services and Tourism). The data disregards informal activities.

If confirmed, the volume will increase by 26.9% compared to 2022 (R$ 6.45 billion), already discounting the inflation of the period.

The estimate, however, indicates a level even lower than the pre-pandemic. It is 3.3% below the 2020 result (BRL 8.47 billion).

According to CNC economist Fabio Bentes, tourism is yet to reach pre-crisis levels due to conditions that make consumption difficult.

In this sense, Bentes cites the rise in services such as passenger air transport and, secondly, high interest rates.

“It is less a health problem, as it has been in recent years, and more an economic problem”, he assesses.

The CNC states that Carnival is considered the “Tourism Christmas”. Within the sector, the highlight should be the segment of bars and restaurants, with an expected turnover of BRL 3.63 billion in 2023.

Then come passenger transport companies (R$ 2.35 billion) and accommodation services in hotels and inns (R$ 0.89 billion).

The trio tends to account for almost 84% of all revenue for the period (R$ 8.18 billion), according to the entity.

The CNC also points out that the demand for tourist services during Carnival should result in the offer of 24,600 temporary jobs.

Like the financial movement, the expected number of jobs also exceeds the 2022 level (15.2 thousand), but remains below the 2020 level (26.1 thousand).