See how the Covid vaccine helped Brazil’s GDP to recover

After feeling the impact of the pandemic in 2020, the service sector, the main GDP (Gross Domestic Product) in Brazil, rose 4.7% in 2021, recovering the losses suffered with Covid-19, reported this Friday. fair (4) the IBGE (Brazilian Institute of Geography and Statistics).

From the point of view of supply, the sector accounts for about 70% of the Brazilian GDP. It encompasses a wide variety of companies: from small businesses to financial and educational institutions. It is also the main employer in the country.

With the health crisis, the segment suffered a severe blow in 2020, with a drop of 4.3%, because a considerable part of the companies that provide services depend on the circulation of consumers. Restaurants, bars, hotels, beauty salons and events are part of this list.

From the vaccination against Covid-19, started in 2021, and the lifting of restrictions on the movement of people, the segment started to bet on improving business, ending the last quarter of the year 1.6% above the same period in 2019. .

All service activities grew last year, especially transportation, warehousing and mail (11.4%). According to the IBGE, the increase in mobility stimulated, for example, the transport of passengers at the end of the year.

Another highlight within services came from the rise in information and communication (12.3%), driven by internet and systems development. This branch, says the institute, gained strength in the pandemic with isolation measures.

Other service activities (7.6%), which bring together companies such as hotels, restaurants, beauty salons and gyms, were also in the blue in 2021.

“These are activities related to face-to-face services, part of the economy that was most affected by the pandemic, but which has recovered again, driven by the families’ own demand for this type of service”, said the coordinator of National Accounts at IBGE, Rebeca Palis. .

In services, there was still an increase in trade (5.5%), real estate activities (2.2%), administration, defense, health, public education and social security (1.5%) and financial, insurance and related services activities (0.7%).

Although the service sector as a whole has returned to the pre-pandemic level, not all segments are above the end of 2019. This is the case, for example, of other service activities, still 1.4% below the pre-crisis .

The recovery of services faces challenges at the start of 2022. Among them are persistent inflation and lower income for Brazilians, which makes consumption difficult.

Industry rises, agro falls

The industry, on the other hand, increased by 4.5% in 2021, according to data released this Friday by the IBGE. The drop in 2020 had been 3.4%. The sector is below pre-pandemic level.

Over the past year, the industry still suffered from bottlenecks in the supply of inputs and higher prices for raw materials. This global derangement is associated by analysts with the effects of the pandemic on factory production.

In industry, the highlight was the performance of construction. After falling 6.3% in 2020, the branch rose 9.7% in 2021.

The manufacturing industries (4.5%), with greater weight in the sector, also grew. Already the extractive industries advanced 3% due to the high in the extraction of iron ore.

Agriculture, in turn, dropped 0.2% in 2021. In the previous year, the sector had felt less the arrival of the pandemic, with growth of 3.8%.

Although global demand for agricultural commodities remained heated in 2021, agriculture suffered losses due to adverse weather. The combination of water crisis and frost shook crops such as coffee, corn and sugar cane last year. Agriculture remains above the pre-pandemic.

This Friday, the IBGE also released GDP data for the fourth quarter of 2021. Between October and December, the service sector grew 0.5% compared to the three immediately previous months.

The industry retreated 1.2% in the fourth quarter. Agriculture rose by 5.8% in the same period.​​