The political crisis in the federal government, which has engulfed the country for much of the past two months, is beginning to be felt in the expectations of Brazilian businessmen, according to the Macroeconomic Scenarios research, which at the end of June queried 36 companies in the services, industrial and retail sectors linked with the Brazilian Association of Open Companies (Abrasca). For 56% of the interviewees, capital goods investments in the second half of 2005 will be stable. In the previous survey, the majority (60%) expected to see an increase in investments over the first half.
According to Abrasca president Alfried Plöger, businessmen are more cautious in relation to the next six months because of both the political uncertainty, which is causing them to put investment projects on the shelf, and because of the weak performance of the Gross Domestic Product (GDP) in the first quarter of this year (0.3%).
"The entrepreneus really do not have an optimist outlook to invest," said Plöger, adding that this shows a slowdown in the economy. "It is the effect of the political crisis, without a doubt," he observed. Expectations for GDP growth in the coming half also indicate a strong change of the trend. While 70% expected an intensification in the rising wealth created in the county in the first half, currently only 33.33% have that opinion. Another 33.33% believe in growth stabilization and the same percentage expect a decline.
A good example that illustrates the lukewarm climate that has taken control of the business community is, according to Plöger, the graphics sector, with 26% idle capacity (four percentage points greater than in 2004).