Since 1995, eight states (SP, RJ, MG, RS, PR, BA, SC and DF) have maintained leadership in the participation in the gross domestic product (GDP) of the country, concentrating almost 80% of economy in 2007. Among major regions, the participation of the Southeast continues to be the greatest, but between 1995 and 2007 it fell from 59.1% to 56.4%. In the same period, the Northeast achieved the greatest progress: from 12.0% to 13.1%. In 2007, nine states, representing 54% of Brazilian GDP, grew above average (6.1%), and MT presented the highest rise (11.3%). DF keeps the highest GDP per capita: R$ 40,696. These are some highlights of Regional Accounts of Brazil 2007, prepared by IBGE in partnership with state statistical organizations and the Superintendence of the Manaus Free Trade Zone (Suframa).

Along with the Regional Accounts 2007, IBGE releases the backward projection of Regional Accounts up to 1995. This method incorporated, in the aggregate calculations, the new weight structures of economic activities, adopted by IBGE in 2002. This has permitted GDP and its components to be revised for previous years, making results comparable to the new series¹.

Backward projected results show that the eight states with the highest GDPs in 2007 (SP, RJ, MG, RS, PR, BA, SC, and DF) were the same in 1995. The difference is that the sum of their participations represented 81.5% of GDP in 1995, decreasing to 78.7% in 2007. In that period, still in the group of those eight, the states to lose participation between 1995 and 2007 were SP, RS, and DF. The participation of the other 19 states changed from 18.5% to 21.3% of GDP. In this group only CE did not increase participation.

From 1995 to 2007, Southeast participation in GDP decreased from 59.1% to 56.4%

The Southeast continues with the greatest participation in the GDP of the country, which between 1995 and 2007 fell (-2.7 pp) from 59.1% to 56.4%. The South has also increased participation in the series (+0.4 pp, from 16.2% to 16.6%) and so did the other regions. The Central West progressed from 8.4% to 8.9% (+0.5 pp).

From 1995 to 2007, the Southeast suffered the biggest fall in participation (-2.7 pp), with SP leading (-3.4%). The economy of São Paulo decreases participation in overall industry (-9.1 pp), loses less in services (-1.5 pp) and gains in agriculture (1.4 pp). The manufacturing industry of the state suffered the major loss (-4.3 pp) among all the 27 Federation units, with the transfer of some industrial sectors to other states, the migration of some industrial plants to near raw material or final consumer is. Besides, some tax incentives for industrial investments in other states also influenced the process.

In RJ, there was a notable advance between 1997 and 2000 (0.7 pp), when the participation of the state reached 11.9% of national GDP. The state is the biggest petroleum producer in Brazil, and in the period it benefited from currency devaluation and the increase in the international price of crude oil. However, in 2007, RJ returned to the same participation as in 1995 (11.2%).MG (0.4 pp) and ES (0.3 pp) increased participation, in MG manufacturing industry stands out, an in ES mining and quarrying industry and services do.

From 1995 to 2007, eight states concentrated more than 87% of value added of industry in the country

The eight more industrialized states in the country (SP, MG, RS, PR, RJ, SC, BA and AM) concentrated 88.7% of the national manufacturing industry in 1995. These participations reduced to 87.2% in 2007.

The state that most reduced participation in industry was São Paulo (-4.3 pp), followed by RS (-1.6 pp). Great part of that lost participation was distributed among the other six leading states of national industry in 2007, besides Goiás, Espírito Santo and Pará.

In a general manner, this process was driven by regional investments, by state tax competition, or by the search for cheaper workforce in other federation units. Moreover, it is still not possible to affirm that there is a massive industrial migration, because a strong movement of redistribution within the state of São Paulo can be noticed.

In the case of industry in Rio Grande do Sul, there was a fall in participation during two consecutive years starting from 2004, when the state had severe droughts

Minas Gerais, in the last years, took part of tobacco industry, principally from Rio Grande do Sul, the automobile chain, besides being the biggest producer of steel and its products (around ¼ of Brazilian production). In the case of Goiás, industry is related to the production of food and beverages; from 2005, its automobile complex begins to participate with approximately 7% of the Brazilian production of cars, station wagons and vans.

From 1995 to 2007, the economies of SP, RJ and RS increased below national average

In real terms, from 1995 to 2007, the accumulated GDP growth of the eight major economies (35.8%) was much inferior to that of the other 19 states (58.4%). In the period, Brazil grew by 39.8% or 2.8% annually.

All the states of the North Region grew, in real terms, above national average (39.8%), and the region had the highest growth in the period (73.6%), being above Central West (63.5%). The leading state in the North region, AM (96.1%), considering the whole country, was surpassed only by MT (111.5%).

The Northeast grew by 44% in the period. There only CE (38%), PE (37%) and AL (31%) grew below the Brazilian average, in real terms. The highlight in the Northeast was Maranhão, which grew by 60.2%.

From 1995 to 2007, the accumulated real growth of the Southeast was 33%. RJ and SP (26% and 32%, respectively) grew below national average (39.8%). MG (42%) and ES (leader in the Southeast, with 69%) grew above national average.

The South Region grew by 39.9% in the period, almost the same as the Brazilian average (39.8%). RS was responsible for this performance, because it grew just 30.9%, below the 47.9% of PR and 44.9% of SC.

The Central West Region (63.5%) was behind just the North Region (73.6%). All the states of the Central West grew above the Brazilian average, MS with 53.3%, MT with 111.5% and GO and DF with 57% and 56.6%, respectively.

In 2007, Northeast and North grew below national average

In 2007, the GDP of regions North and Northeast grew by 3.8% and 4.8%, respectively (Table 4). Both rates were below the real GDP change in the country (6.1%). South, Southeast and Central West regions were above average, the last one with the biggest change (6.8%). Regional participations did not alter much in the period, and those of regions South and Central West had a slight increase.

Maranhão took up the 16th position in 2003

In 2003, Maranhão changed position with Mato Grosso do Sul and remained in the 16^th position up to 2007. In the economy of Maranhão, services have been losing participation to industry: from 16.7% of state economy in 2002 to 17.9% in 2007, with the production of pig iron, calcined alumina, unalloyed aluminum and aluminum alloy. Even so, the public sector still represents around 20% of the state economy. The participation of agriculture in the economy of MT decreased approximately 6.5% between 2002 and 2007. In 2006, agriculture participated with 14.5% in total economy; in 2007, it started to represent 15.8%, with the recovery of soy crop, which increased its participation by 1.8% of gross value added, becoming 2.9%.

The participation of RN in GDP (0.9%) was 0.1 pp higher than that of 2002, surpassing Paraíba (0.8%) since 2004. Those two economies are very similar, except for petroleum: RN is the second main producer in Brazil, behind RJ. In manufacturing industry of RN, foods, beverages, textiles, apparel, footwear, leather, plastic and other non-metallic minerals account for 77%, whereas in the manufacturing industry of Paraíba the highlights are textiles, apparel, footwear, leather (38%), foods and beverages (15%).

Alagoas, Sergipe, Rondônia, Piauí and Tocantins kept their positions in the period. Only Rondônia increased participation in the Brazilian GDP, by 0.1 percentage point. Alagoas has a farming structure similar to that of Paraíba, predominantly agricultural, but there is a stronger influence of sugarcane in its economy. In 2006, the sector food products and beverages increased participation in industry to 70%, because of the poor performance of chemical industry, keeping the same structure in 2007. In RN, agriculture and livestock have similar influences, except for the importance of irrigated fruit culture for export in RN economy. In Sergipe, the industrial activity represents 30.6% of economy: 6.2% in petroleum extraction, 9.7% in manufacturing industry, 8.1% in the production and distribution of electricity (the Xingó hydroelectric power plant belongs to the state) and 6.6% in civil construction.

São Paulo concentrates 11.8% of GDP in Brazilian agriculture

In 2007, agriculture in São Paulo accounted for 2.0% of GDP in the state and for 11.8% of this activity in Brazil, below the 13.5% of 2002. Sugarcane, orange and cattle breeding were responsible for approximately 59.1% of agriculture in São Paulo in 2007. General industry in São Paulo, which accounted for 29.6% of the economy in the state in 2007, had its participation in national industry reduced in 2.3 pp, between 2002 and 2007, although it had recovered 0.6 pp of participation in relation to 2006, being with 35.4% of national industry in 2007.

In 2007, Rio Grande do Sul maintained its participation in national GDP (7.1% in 2002, 7.1% in 2004, 6.7% in 2005 and 6.6% in 2007, respectively). Although agriculture advanced by 3.5% in relation to 2005, a superior level to that reached in 2002 (11% of national agriculture in 2002 and 11.9% in 2007), industry and services did not return to the level reached in 2002, 7.5% in 2002 against 6.4% in 2007 (general industry) and 6.8% against 6.4% in 2007 (services).

RJ and MG kept their positions in the ranking, however RJ retreated by 0.5% between 2006 and 2007, influenced by mining and quarrying industry, which had a price reduction according to the price of petroleum barrel and to the valuation of the real in relation to the dollar, considering 2006. Bahia, the sixth greatest GDP in the period, had its participation come back to the level of 2004 (4.1%) in 2006 and kept it in 2007.

In Pará, industry represented 31% in 2007, distributed among mining and quarrying industry (6.4%), manufacturing industry (12.4%), production and distribution of electricity and gas, sewage and urban cleaning (5.5%) and civil construction (6.7%). In 2007 industry in Amazonas accounted for 42.5% of local economy against 45.7% in 2006, a fall influenced by the loss of participation of manufacturing industry, which changed from 3.4% in 2006 to 2.9% of the Brazilian manufacturing industry in 2007.

Mato Grosso and Amazonas are the only states that changed position between 2006 and 2007. MT took the 15^th position, surpassing AM, which went to the 14^th position. This was due to the recovery of economic activity by MT, since the state had a decrease of around 4% in its GDP, the lowest result in its history and the lowest among the 27 states in 2006.

Rondônia, which in the last years stood out in livestock and grain production (principally soy), has its economy based on agricultural production (20.3%) and services (65%), of which 28.8% correspond to public administration. Piauí, with 0.5% in the Brazilian GDP, is on the 23^rd position, being its economy distributed as follows: 8.2% in agriculture (cassava, corn and soy, which has been gaining importance), 16.9% in industry (food and beverages in industry) and 74.8% in services.

Tocantins is on the 24^th position, with 0.4% of national GDP in all years of the series. Its agriculture represents 17.8% (rice, corn, soy and cattle); its industry, 24.1% (of which 13.6% belong to civil construction) and services, 58.1%, where public administration participates with 24.5%. The importance of civil construction in the economy of Tocantins, a recently created state, is the first among the 27 federative units.

Acre (25^th) and Amapá (26^th), very close to each other, changed position during the series and greatly depend on the public sector. Amapá and Roraima have approximately 50% of their economy linked to the public sector. Roraima keeps the lowest GDP among the 27 federative units.

In 2007, GDP of Mato Grosso had the highest growth (11.3%) and São Paulo the fourth (7.4%)

In 2007, nine of the 27 federative units had the same or superior growth to the Brazilian average (6.1%). They represented 53.6% of GDP in the country. Santa Catarina grew by 6.0% and was the only state of the South with a result inferior to the Brazilian average.

Federal District continues with the highest GDP per capita in the country

The highest GDP per capita continues to be that of the Federal District (R$ 40,696.08), around three times the national GDP per capita. In the period, the three highest GDP per capita remained in the same order (the Federal District, São Paulo and Rio de Janeiro), as well as the two lowest (Maranhão and Piauí).

Among the states with GDP per capita inferior to the country average in the first year of the series, Mato Grosso was the first to surpass the national average in the next years: in 2002, GDP per capita of the state was 90% of the Brazilian. In 2004, GDP of MT was 30% higher than the average, and in 2007, it was 3% above it. The other states with GDP per capita above national average were: the Federal District, São Paulo, Rio de Janeiro, Espírito Santo, Santa Catarina, Rio Grande do Sul and Paraná.

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¹ The year 1995 was chosen so that the series comprised the period of effect of a currency (in this case, the Real). The technical notes on backward projection are available at: https://www.ibge.gov.br/home/estatistica/indicadores/pib/pdf/26_retropolacaoregional.pdf.