São Paulo – Processing industries in the state of São Paulo will likely not grow this year. Even the estimate of the Federation of Industries of the State of São Paulo (Fiesp) for this year, that the sector will remain stable compared with last year, will probably not prove true. “In order for the industry to meet our forecast of a breakeven it would need to grow by 0.6% each month from now until the end of the year. It is a near-impossible mission,” said the director of the Fiesp Department of Economic Research and Studies (Depecon), Walter Sacca.
The São Paulo industry employment level was 1.14% in April (seasonally adjusted) compared with March, according to a balance sheet issued today (15th). Based on non-adjusted figures, the rate was 0.55%, with 14,000 new job positions. In relation to April last year, there was a 3.16% decline, meaning that 85,000 positions were closed. Year-to-date as of April, the employment level remains positive, with a 18,000 job position surplus, 0.69% more than in the first four months of 2011.
Despite the pessimistic industry performance forecast, Sacca emphasized the change in scenario over the last few weeks. “The exchange rate may not be the best possible, but it’s improved quite a lot. The interest rates may not be the best possible, but it’s improved quite a lot. There is another part of the tripod which is lacking and we’ve been complaining about it, which is the Brazil cost [i.e. the cost of doing business in the country]; the lowering of said cost would be a complement to boost our competitiveness.” According to him, the government’s measures to lower interest rates and stimulate activity will only impact the economy significantly in 2013.
*Translated by Gabriel Pomerancblum
