10% cut in energy consumption in Brazil could reduce GDP by 1% -Credit Suisse

RIO DE JANEIRO, BRAZIL – A 10% reduction in energy consumption in Brazil in 2022 can reduce the Gross Domestic Product (GDP) by one percentage point, according to the chief economist at Credit Suisse Brazil, Solange Srour.

The executive recalled that, thus, with the projection that the GDP will grow by 1.1% in 2022, an eventual scenario of reduced demand for energy could zero out the country’s growth next year. The fear comes amid the most significant drought in the last 91 years, which reduced the reservoirs of the hydroelectric plants and generated uncertainties about the supply of electricity.

Srour believes that Brazil should program itself to do long-term planning for several sectors amid climate changes. She explained, for example, that there is an expectation in the coming years of reduced rainfall volume in the Northeast and central part of Brazil and increased in the South, which generates opportunities for new investments in different regions.

“International pressures will be increasingly strong so that the construction of large hydroelectric plants in the Amazon will no longer occur, for example. We can take advantage of this opportunity to displace investment to regions with greater potential for use. There is a lack of public policies that think not in the interest of a certain sector, but that aim to increase the resilience of Brazilian society,” she said.

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