Bloomberg News

Brazil Said to Boost Spending for Local Suppliers Amid Slowdown

June 26, 2012

Brazil will step up efforts to favor local suppliers in government purchases in a bid to revive flagging economic growth, according to two government officials.

As part of a package of measures worth 5 billion reais ($2.4 billion), the government will announce tomorrow that it will channel spending by the education, health and defense ministries to Brazilian manufacturers who are being hurt by a slowdown in growth, according to the officials, who spoke on condition of anonymity because the plan hasn’t been announced.

Trade Minister Fernando Pimentel told reporters in Sao Paulo today that the government would announce tomorrow measures to boost investment in select industries. He did not provide details.

As part of a package of incentives announced in April to aid industry, the federal government said it would pay up to 25 percent more for some locally-produced goods.

Brazil’s economy will grow 2.18 percent this year, less than the 2.7 percent expansion in 2011, according to a June 22 central bank survey of about 100 economists.

To contact the reporter on this story: Arnaldo Galvao in Brasilia Newsroom at agalvao1@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net


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