By Kate Rintoul, Contributing Reporter
RIO DE JANEIRO, BRAZIL – According to the Economic Climate Indicator (ICE) released by the Fundação Getulio Vargas (FGV) on Wednesday, August 13th the economic climate in Latin America in July is the worst since 2009, with Brazil performing badly in key areas.
The index, which is done in partnership with the German Ifo institute, fell from ninety points in April to 84 points in July. This represented a fall to levels last recorded in Latin America five years ago. According to Lia Valls, the researcher from FGV, the main contribution to the fall came in the last month of the quarter when the region fell from 82 to 72 points.
While Brazil is the second largest economy in Latin America in terms of trade, after Mexico the country recorded worsening in all sectors and a decrease of 22 percent between April and July of this year.
“We have seen a marked worsening of the economic climate since the beginning of the year. Expectancy also fell, but less,” added Valls. “What the survey shows is that in the short term there will be no improvement in this indicator,” said the researcher.
Brazil’s individual score on the index of economic climate was recorded at 55 points, surprised some as it was lower than debt defaulters Argentina (57 points) it is thought this is emphasize the impact of the financial crisis in the neighboring country will have.
In an election year, economic concerns over Brazil’s long term prosperity could be brought into question as results have shown consistent decline. In a ranking based on the last four quarters, Brazil ranked ninth. The Economic Climate indicator in the region fell by seven percent, while the global aggregate increased by three percent.
The fall has been influenced by domestic issues, according to the researcher. “While in the rest of the world the situation is improving, here it has consistently gotten worse,” said Valls.
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