After growing by 4.7%, on average, during the period 2004-2007 and expanding by 5.2% in 2008, the Brazilian Gross Domestic Product (GDP) changed -0.3% in 2009 compared with the previous year. In current values, the result was R$ 3,239 billion and the deflator – average change in prices compared with the average prices of the previous period - of the GDP was 7.2%. Per capita GDP reached R$ 16,917.66 in 2009, meaning a drop in volume of 1.3% compared with 2008.

 

These and other definitive results are part of the System of National Accounts – Brazil 2005-2009. The full publication can be accessed at the link https://www.ibge.gov.br/home/estatistica/economia/contasnacionais/2009/default.shtm.

 

For the first time, IBGE releases the financial account by institutional sector – which records the operations through financial instruments involving financial assets and liabilities between institutional sectors or between institutional sectors and the rest of the world – and the financial assets account – which shows the stock of financial assets and liabilities resulting either from economic operations and transactions or other flows ( price changes, currency changes and other changes of volume) -, extending the level of information of the System of National Accounts.

 

The full publication Financial Account and Financial Assets Account 2004-2009 is available at the link https://www.ibge.gov.br/home/estatistica/economia/conta_financeira/2009/default.shtm.

 

GDP can be calculated according to 3 perspectives:

 

§       Production oriented – equals to the gross value of production, minus intermediate consumption – goods and services used as inputs in the production process – plus taxes, minus subsidies;

 

§       Demand oriented – equals to the household expenditures, Government expenditures, plus non-profit institutions at the service of families expenditures (final consumption), plus gross fixed capital formation, plus change in stocks, plus exports of goods, minus imports of goods and services. It allows the analysis according to the destination of goods and services made available by the economy for final use;

 

§       Income oriented – equals to compensation of employees, plus total taxes over production and imports, free of subsidies, plus gross mixed income (compensation received by unincorporated company owners – freelancers), plus gross operating surplus (balance resulting from the value added deducted by compensation of employees, by mixed income and by taxes over production net of subsidies).

 

 

PRODUCTION ORIENTED GDP: services is the only group that grew in 2009 (2.1%)

GDP changed -0.3% in 2009 after having grown by 5.2% in 2008 and by 6.1% in 2007. Slowing was not uniform along different economic activities.

 

Services grew by 2.1% in 2009, highlighted by the activities “financial intermediation” (7.8%) and “services provided to families and associative” (4.3%), the latter due to the maintenance of final consumption expenditures by families. Another highlight is the growth of 3.0% of the gross value added generated by “public education, health and administration”. Trade changed by -1.0%, in contrast with the growth by 6.1% registered in 2008. Such decrease contributed to the negative change of its participation in the value added of services, which fell from 18.9% in 2008 to 18.5% in 2009.

 

Industry showed a fall in volume by 5.6%, losing 1.1 percentage point of participation in the total value added of the economy. The reduction of the volume of investments in 2009 primarily affected the growth of "manufacturing of trucks and buses” (-29.7%), “manufacturing of machinery and equipments” (-22.1%) and “electronic material and communication equipment” (-19.2%). The gross value added of “civil construction” fell by 0.7% in 2009, after having grown by 7.9% in 2008.

 

Agriculture fell in volume by 3.1%, as a result of the reduction by 5.0% in the gross value added of “agriculture, forestry and logging" and of the growth of only 1.0% of the group "livestock and fishing". This is the first drop noticed along the new adjusted series which started in 1995. Such performance may be partly explained by the fall of production and productivity of some crops – due to climate conditions in 2009 – and by the uncertainties of the international scene.

 

 

DEMAND ORIENTED GDP: final consumption grows by 4.1% leveraged by families

 

The component of demand with the highest growth in 2009 was final consumption (4.1%), which changed from 79.1% of the GDP in 2008 to 82.3% in 2009. The major contribution to this growth came from "family consumption", which grew by 4.4%, in accordance with the 3.3% increase of payroll, according to the Monthly Employment Survey, and with the 19.7% increase, in nominal terms, of credit operations of the financial system for natural persons, according to the data from the Central Bank of Brazil.

 

Even growing at a lower pace than “consumption of non-profit institutions at the service of families” (5.7%), the consumption of families was the major contribution to this increase due to its importance for total consumption. “Government consumption” rose by 3.1%. 

In the analysis by consumed goods and services, the highlights were the consumption of “financial intermediation, insurance, complementary social security and related services”, which grew by 10.6% and of "energy and gas, water, sewage and urban sanitation” (6.5%). Among the goods and services with the highest increases of price for final consumption, the highlights were “information services” (9.6%) and “real estate activities and rentals” (8.1%). 

Gross fixed capital formation reached R$ 585.3 billion in 2009, a nominal increase of 1.0% comparing with the previous year (R$ 579.5 billion). However, the volume was reduced by 6.7%, the only drop in the period between 2005 and 2009. The positive nominal result is due to this negative change in volume, associated with the average increase by 8.3% of the prices of products that form the investment. The “investment rate”, the participation of gross fixed capital formation in GDP, was 17.9% in 2009, decreasing 0.9 percentage point comparing with the previous year. Though interrupting a sequence of 3 consecutive years of growth, GFCF has recorded its second biggest participation since 2000. In terms of relative participation, “machinery and equipment” interrupted the upward trend observed in the last few years, changing from 56.7% in 2008 to 50.1% in 2009, the equivalent to R$ 293.3 billion. On the other hand, the participation of “construction” increased from 36.3% to 42.3%, whereas the category “others” changed from 7.0% to 7.6%.

 

Exports and imports registered drop in volume by 9.1% and 7.6%, respectively. Concerning exports, the highlight is the drop of volume of “capital goods” (-41.5%) and “durable consumer goods” (-32.0%). Regarding the volume of imports, the highlights were the drop in imports of “intermediate goods and services” (-11.9%) and “capital goods” (-8.7%), partially counterbalanced by the expansion of imports of “non-durable consumer goods and services” (22.3%). 

 

 

INCOME ORIENTED GDP: number of workers with formal employment grew by 4.3%

 

The total jobs in 2009, 96,647,139, remained stable when compared with 2008 (96,232,609 job posts).

Among the types of insertion in the labor market, there was an increase in the number of “workers with a formal employment contract” (4.3%) and a decrease in “self-employed workers” (-1.5%) as well as “workers without a formal employment contract” (-3.5%).

 

Regarding groups of activities, “services” accounted for 62.1% of the total job posts, “industry” for 20.5% and “agriculture” for 17.4%. In spite of the stability of the job posts, the average annual income registered expansion by 8.0%, a rise leveraged by “industry” (10.6%). There was growth of 6.9% in “services” and of 2.8% in “agriculture”.

 

The participation of compensation of workers in GDP rose from 41.8% in 2008 to 43.6% in 2009, the most significant rise in the decade. This growth was primarily due to the increase of 11.2% in the nominal wages.

 

INTEGRATED ECONOMIC ACCOUNTS: net borrowing of the economy rose R$ 4.2 billion in 2009

 

The integrated economic accounts provide information by institutional sectors for the whole economy and its relationship with the rest of the world. The Gross National Revenue (GDP minus net income of the production factors sent to the rest of the world) was R$ 3,175 billion. The year of 2009 maintained the downward trend of the net payment of income from properties to the rest of the world comparing with the previous year, observed since 2006. There drop of 11.3% in 2009. The only exception between 2006 and 2009 was 2008, when there was an increase of 30.8% in the net payment of income from properties to the rest of the world comparing with the previous year, due to the financial crisis.

 

The fall in the net payment of income from properties to the rest of the world observed in 2009 explains the bigger of the GNR as compared to the GDP, in nominal terms: 7.3% against 6.8%. The growth of expenditure of final consumption above the GNR – 11.2% and 7.3%, respectively – caused a drop of 9.5% in savings. The nominal growth of the gross fixed capital formation (1.0%) associated with the worsening current foreign balance implied the raise by R$ 4.2 billion in the need lending of the country. It reached R$ 60,332 billion in 2009, against R$ 56,129 billion in 2008. In terms of GDP, net lending remained stable at 1.9%.

 

Despite of the fall in the activity in 2009, non-financial companies improved their net lending, changing from net borrowing of R$ 69.8 billion in 2008 to net lending of R$ 2.5 billion in 2009. The main reason for this improvement is in the drop of 19.0% of gross fixed capital formation, which changed from R$ 419.9 billion in 2008 to R$ 340.2 billion in 2009 – a drop of R$ 80.0 billion in nominal terms.

  

The sector financial companies showed a drop in net lending, with a change from R$ 92.1 billion in 2008 to R$ 83.3 billion in 2009. The factors that mostly contributed to this drop were the slowing of credit and of income with financial services - which grew by 1.4% in 2009, against 5.5% in 2008. The total volume of credit rose by 20.3% comparing with the previous year, less than the figure of 31.9% in 2008. Credit operations of the financial system for families also grew less in 2008 – 19.8% against 30.3%, respectively.

 

Public administration: gross tax burden shows first decrease since 2003

 

For the first time in the 2000 series there was a decrease in nominal values of the collection of "Taxes over production and imports, net of subsidies”. The drop was influenced by the decrease in the economic activity, by tax relieves, by the increase of subsidies and by the decrease of imports. The gross tax burden changed from 34.9% of the GDP in 2008 to 33.7% of the GDP in 2009.

 

The participation of the public administration activity in the total value added showed a positive figure, changing from 15.8% to 16.3% between 2008 and 2009. This increase was due to the maintenance of the productive activities of the Government when compared to the slowing of the activities of families and non-financial companies.

 

The expansion of the gross fixed capital formation (12.0%) and the negative change of the gross saving match to the raise of the net borrowing of the public administration of about 72.5%, against the result found in 2008. The net borrowing of the public administration changed from R$ 86.6 billion in 2008 to R$ 149.3 billion in 2009.

 

Net lending of families drops in 2009

 

The value added of the production from families rose, in nominal terms, by 4.8% comparing with 2008, while the value added of the whole economy grew by 6.8%. This change below the average made the participation of sector families in the total generated income drop by 0.7 percentage point. On the other hand, the compensation received by workers rose by 11.5% in the period, reaching R$ 1.4 trillion. This shows that the increase in the formalization of production proceeded in 2009, which can be also observed by the increase in the number of workers with an employment record card, as registered by the National Household Sample Survey – PNAD.

 

The expenditures of families with payment of interests increased due to the growth of credit for natural persons, though more than compensated by the increase of labor income and by the interests received, leading to the expansion of the disposable income of families.

 

The gross disposable income of families rose by 11.3% in 2009 in nominal terms, reaching R$ 2.0 trillion. The final consumption of families reached R$ 1.9 trillion, leveraged by the raises in income and credit. Its nominal change was 10.8% comparing with 2008. The difference between the raises of income and consumption made the savings of families reach R$ 146.7 billion in 2009.

 

Even with the raise of savings, the net lending of families decreased. One of the major reasons for such reduction was the gross fixed capital formation of families, which grew more than savings.

 

The difference between the raises of savings and investment of families led to a decrease in the capacity of funding, which was R$ 2.3 billion in 2009 (R$ 7.2 billion in 2008).

 

FINANCIAL ACCOUNTS

 

The financial account is expressed by the initial and final assets accounts (financial assets and liabilities) and by the assets change accounts. It is expressed for the institutional sectors and for the whole economy. The financial accounts record, through financial instruments, the changes in the financial assets along the accounting period, due to financial operations – transactions and other assets changes -, re-valuations and other changes in volume.

 

Non-financial companies – in assets, instruments “Shares and other participations” and “Other debts/credits” accounted for more than 80% of the total of financial assets in the period. In terms of liabilities, “Loans”, “Shares and other participations” and “Other debts/credits” accounted for 97% of the total.

 

Financial companies – show a concentration in terms of assets in instruments “Securities, except shares”, “Loans” and “Shares and other participations”, accounting for 85% of the total in 2009. The liabilities are basically distributed among the instruments “Cash and deposits”, “Securities, except shares”, “Loans” and “Shares and other participations”.

 

Public administration – shows an assets distribution among the instruments “Cash and deposits”, “Loans”, “Shares and other participations” and “Other debts/credits”, accounting for 97% of the total in 2009. Regarding liabilities, “Securities, except shares” is the most significant (60%) instrument.

 

Families and non-profit institutions at the service of families – highly widespread among the assets, basically distributed into “Cash and deposits”, “Securities, except shares”, “Shares and other participations”, “Technical reserves for insurance” and “Other debts/credits”. On the other hand, the liabilities are restricted to “Loans” e “Other debts/credits”.