In 2005, the Gross National Product at market prices increased R$ 1,937.6 billion. R$ 1,728.5 billion were referent to Value Added at basic prices and R$ 209.1 billion were referent to Taxes on Products. Among the components of Value Added, Agriculture registered R$ 145.8 billion, Industry R$ 690.6 billion and Services R$ 985.3 billion.  In the fourth quarter of 2005, GDP measured at market prices was R$ 521.9 billion. R$ 466.2 billion were referent to Value Added at basic prices and R$ 55.7 billion to Taxes on Products.

Among the components of demand, in 2005, Family Consumption reached R$ 1,075.3 billion, Government Consumption, R$ 378.7 billion and Gross Fixed Capital Formation, R$ 385.9 billion. The Balance of Goods and Services was positive in R$ 84.9 billion and Stock Variation was R$ 12.7 billion. 

Components of Gross Domestic Product considering Production and Expenditure

In relation to the participation of each sector in Value Added at basic prices, Agriculture fell compared to 2004, reaching 8.4% compared to 10.1%.  The current value of Agriculture was R$ 145.8 billion, in 2005, and R$ 159.6 billion, in 2004, resulting in a fall of 8.7%.  On the other hand, Industry and Services had positive performances, 40% and 57%, respectively.  Among the components of demand, Family Consumption registered 55.5% of participation in relation to the GDP, Investment 20.6% and Government Consumption 19.5%.  The Foreign Sector reduced its participation, in relation to 2004, due to valuation of the Real compared to the dollar. Exports contributed with 16.8%, in 2005, compared to 18.0% in 2004. Imports reached 12.4%, in the previous year, compared to 13.4% in 2004.

GDP per capita at current prices, fixed as the division of the total GDP at current prices by the resident population was R$ 10.520 in 2005.  The Implicit Deflator of the GDP in 2005, average change of the prices in the current year in relation to the average prices of the previous year was 7.2%.

Gross Domestic Product, Gross Domestic Product per Capita, Resident Population and Implicit Deflator – 1999/2005

In the value accumulated in the year, there was reduction in net lending

Net lending of the National Economy was R$ 7.0 billion in the fourth quarter of 2005, which means, an increase of R$ 1.7 billion if compared to the same period of 2004 (net lending of R$ 5.3 billion).  This increase occurred, mainly, due to the Foreign Current Balance (R$ 2.0 billion) caused by the increase of the Foreign Balance of Goods and Services which changed from a surplus of R$ 18.7 billion, in the fourth quarter of 2004, to a surplus of R$ 21.2 billion, in the same period of 2005.

In the result accumulated in the year, net lending reached R$ 33.6 billion compared to R$ 34.5 billion in 2004. This result occurred due to the reduction of the account of Current Net Transfers Received From the Rest of the World amounting to R$ 0.9 billion and to the increase of R$ 3.1 billion in Net Property Income Sent to the Rest of the World (increase by R$ 9.3 billion of net profits sent abroad and reduction by R$ 6.2 billion in net sending of interests).

The Gross National Income was R$ 505.4 billion in the fourth quarter of 2005 compared to R$ 462.0 billion in the same period of 2004.  In the accumulated value of the year it reached R$ 1,876.0 billion compared to  R$ 1,708.1 billion in 2004.  In this same base of comparison Gross Savings reached R$ 97.0 billion, in the last quarter of 2005, and R$ 93.3 billion in the same period of 2004.  In the annual comparison, Gross Savings reached R$ 430.5 billion in 2005 compared to R$ 410.1 billion in 2004.

In 2005, inflow of Porfolio Foreign Investment was highest since 1998 

In the fourth quarter of 2005, the National Economy registered a reduction in the changing of assets (1) – which changed from a net positive investment of R$ 13.6 billion in the fourth quarter of 2004 to a negative investment of R$ 12.2 billion in the same period of 2005.  Regarding changing in liabilities, net funding changed from a positive value of R$ 7.9 billion to a net negative funding of R$ 19.1 billion, in the same period of comparison. In 2005, the net changes of assets and liabilities were, respectively, positive by R$ 29.8 billion and negative by R$ 4.6 billion. In 2004, these amounts were positive in R$ 39.9 billion for assets (investment) and in R$5.5 billion for liabilities (funding).

In the quarter, among the factors which influenced net funding in relation to the fourth quarter of 2004 stand out: the growing of amortizations of loans and long-term financings, Loans and Financings – F.4 and the reduction of funding through Shares and Other Capital Participations - F.5.

Regarding the financial instrument F.4, there was increase in the negative net funding, of R$ 4.2 billion to R$ 29.5 billion in the four quarters of 2004 and 2005, respectively.  In this variation, stood out the payment of amortization in R$ 35.3 billion of loans with the International Monetary Fund in December  2005.  In relation to the instrument F.5, the positive net funding changed from R$ 18.4 billion to R$ 13.0 billion in the fourth quarter of 2005. The main reason for the decrease in the volume was the outflow of the Direct Foreign Investment (IED) (2), under the form of capital participation, which had a negative net funding of R$ 9.0 billion in the quarter compared to R$ 14.6 billion in the same period of 2004.  In 2005, the Foreign Direct Investment was R$ 37.4 billion compared to R$ 52.9 billion, in 2004, resulting in a reduction of R$ 15.5 billion in the year(3).  On the other hand, the part of Instrument F.5, formed by  Foreign Investment in Portfolio (IEC), had a significant growth: changing from a positive funding of R$ 5.6 billion in 2004 to R$ 15.6 billion in 2005. 

In the assets changes in the quarter – a net negative investment of R$ 12.2 billion compared to a net positive investment of R$ 13.6 billion in the same period of 2004 – stands out the reduction of investments through the instrument F.2 – Cash and Deposits – which was positive in R$ 9.1 billion in the fourth quarter of 2004 compared to a net negative investment of R$ 7.9 billion in the fourth quarter of 2005.  In the values observed in this instrument stood out:  the reduction of net investments in the financial sector which was negative in R$ 7.1 billion in the quarter, against a positive net investment of R$ 4.7 billion in the same quarter of 2004; the reduction of the investments of the International Reserves in form of Cash and Deposits, which changed from a net positive investment of R$ 2.8 billion in the fourth quarter of 2004 to a net negative investment of R$ 1.7 billion in the same quarter of 2005.  Stands out, also, the change in the net investment of the instrument F3 – Securities except Shares: in the fourth quarter of 2004 it registered a positive net investment of R$ 1.5 billion, and in the same period of 2005 it recorded a negative net investment of R$ 4.9 billion.  In the change of this instrument, stands out the reduction of investments in F.32 (Securities except Long-term Shares), such as the investments of the International Reserves in Bonds and Notes, which reached a net negative investment of R$ 5.3 billion in the fourth quarter of 2005, compared to a net negative change of R$ 0.3 billion in the same period of 2004.

In 2005, international reserves increased by R$ 12.7 billion

The data show that accounting the transactions referent to the agreements with the IMF, in the fourth quarter of 2005 the National Economy had a reduction of international reserves in R$ 6.8 billion, against an increase of R$ 4.4 billion in the same quarter of 2004.  Excluding the transactions with the Monetary Fund, there were increase in the reserves in R$ 28.5 billion, against an increase of R$ 7 billion in the fourth quarter of 2004.  In the accumulated value of 2005, the international reserves increased with and without the accounting of the transactions with the IMF, being in these cases, respectively, R$ 12.7 billion and R$ 67 billion.

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[1] Including reserve assets.

[2] In the financial instrument F.5 (Shares and Other Capital Participations) intercomapany loans are not included. These loans are accounted in the instrument F.7 (Other Credits and Debits).

[3] Memorandum datum– Foreign Direct Investment, from table IV.5.