LatinNews Daily - 30 April 2021

In brief: Brazil sees primary surplus in March

* Brazil’s economy ministry has reported that the central government saw a primary fiscal surplus of R$2.1bn (US$394m) in March this year. This compares with a primary fiscal deficit of R$22.2bn in March 2020, and is the first positive result in government accounts for the month of March since 2015. “The March result was positive, well above the expectations ceiling,” Bruno Funchal, the outgoing national treasury secretary, said. This positive result is largely due to an increase in the government’s tax take, as well as the fact that the 2021 budget had not yet been approved in March, constraining the government’s spending capacity. In the first quarter of the year, Brazil’s central government accumulated a R$24.44bn primary surplus, but government accounts have accumulated a R$759.5bn deficit in the 12 months to March, equivalent to 9.5% of GDP. Funchal noted that this 12-month deficit is very high, driven by spending to tackle the coronavirus (Covid-19) pandemic. The reactivation of the economy is expected to help bring down the fiscal deficit in coming months, with this year’s budget planning for a R$247.1bn primary deficit, although several billions of reais of emergency expenditures are due to fall outside of the fiscal target.  

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