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LatinNews Daily - 03 November 2020

In brief: IMF recommends Brazil maintain pandemic fiscal support

* The International Monetary Fund (IMF) has released a report on growth in the G-20 countries as they battle the effects of the coronavirus (Covid-19) pandemic, in which it warns that “the crisis is not over, keep spending (wisely)”. The IMF singles out Brazil in some of its recommendations, advising that “larger support than currently projected is desirable next year ... in view of the large drops in the level of employment ... and large projected fiscal contractions” .The IMF also highlights the importance of a strong social safety net, including Brazil among the countries which should look to “better targeted social transfers and/or a wider coverage of social protection spending… [to] help safeguard vulnerable groups” .  Brazil is, however, also cited as a country which should pay close attention to both the level and the efficiency of its spending, and the IMF does emphasise that countries should maintain socio-economic support within the fiscal space available. “Where fiscal space is a constraint, a re-prioritisation of spending may be warranted”, the IMF notes. The main economic support programme in Brazil has been a monthly handout, dubbed the ‘emergency basic income’, which reached around a third of the population from April to August, but has already been trimmed down, and is due to end in December.

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