GDP of states linked to agro should grow more in the pandemic; see list

With the advance of commodity prices, part of the states most linked to the agribusiness should register higher GDP (Gross Domestic Product) growth throughout the pandemic, indicate projections by MB Associados.

According to the consultancy, Mato Grosso do Sul (4.9%), Tocantins (4.7%) and Goiás (4.5%) tend to show the most intense increases in GDP from 2020 to 2022, compared to 2019, the year before the health crisis.

“We saw an important impact of the appreciation of commodities in the pandemic. It is natural that this pulls up the projections in states like these”, evaluates Sergio Vale, chief economist at MB Associados.

Then appear Pará and Espírito Santo, with growth estimates of 4% and 3.9%, respectively, from 2020 to 2022.

“Pará has the impact of extractive activity”, points out Vale. “Espirito Santo has a strong base of cellulose. There is also the effect of the appreciation of commodities”, he adds.

The most recent data from the IBGE (Brazilian Institute of Geography and Statistics) on the GDP of the states refer to 2019. MB seeks to estimate the performance with the ongoing pandemic in the following years.

In the case of the national GDP, the already known results go up to 2021. According to the IBGE, the indicator plummeted 3.9% in the country in 2020. After the fall in the initial year of the pandemic, there was a rise of 4.6% in 2021.

In 2022, MB projects a national GDP stagnation. In other words, the expectation is for zero variation, 0%.

Thus, according to the consultancy’s calculations, the indicator should accumulate a slight advance of 0.5% between 2020 and 2022, compared to 2019.

“Growing 0.5% in three years is almost nothing. The scenario for 2022 is of a still weak economy in the country. This will prevent the states from having a more vigorous recovery”, says Vale.

In the accumulated from 2020 to 2022, 15 units of the Federation —14 states and the Federal District— should register a variation greater than that of the Brazilian GDP, according to MB.

In São Paulo, the largest state economy, the estimated growth in the period is 1.3%.

According to forecasts, three federation units should repeat the slight advance of 0.5% in the Brazilian indicator. They are the following: Roraima, Piauí and Paraíba.

Finally, nine states tend to be below the national GDP in the accumulated from 2020 to 2022. Of these nine, four should show a decline in the indicator, signals the consultancy. They are as follows: Alagoas (-1.4%), Acre (-0.9%), Ceará (-0.7%) and Bahia (-0.2%).

Vale points out that the restrictions generated by Covid-19 harmed states with a great weight of face-to-face services. Members from the Northeast are part of this list.

In the region, recalls the economist, the Emergency aid mitigated initial damage from the pandemic. But, with the end of the social benefit and the escalation of inflation in the country, the recovery of consumption tends to get more complicated, he concludes.

“Inflation is eroding the population’s purchasing power. This affects states with lower incomes”, says Vale.

In 2022, forecast is 14 FUs above Brazil

In the specific cut of the year 2022, 14 units of the Federation should have a GDP with a performance superior to that of Brazil, indicates the MB.

The highest forecast is for Tocantins, 1.7%, after projections of a 1.6% indentation in 2020 and an advance of 4.6% in 2021.

Then appear Mato Grosso do Sul and Goiás. In both cases, the expected growth in 2022 is 1.4%.

Nine states tend to register zero variation this year, like the country. Another four should show slight negative rates: Acre (-0.3%), Amazonas (-0.2%), Bahia (-0.2%) and Amapá (-0.1%).

Economists estimate that the macroeconomic scenario brings together a series of risks in 2022. High inflation has forced an increase in interest rates, which hinders consumption and productive investments by companies.

In addition, there are uncertainties about the electoral race and concern about the unfolding of the war between Russia and Ukraine.

One of the fears related to the conflict in Eastern Europe is the scarcity of fertilizers, which would affect agriculture, due to the Brazilian dependence on imports of the product.