According to the International Business Report (IBR) 2012 Grant Thornton International, 74% of Brazilian businessmen are optimistic about the Brazilian economy in 2012.
The Grant Thornton International Business Report (IBR) is a quarterly survey of business leaders from across the globe to measure global business confidence. Launched in 1992, the report is now in its 20th year. The research is carried out primarily by telephone interview lasting about 15 minutes with the exception of Japan (postal), Philippines and Armenia (face to face), mainland China and India (mixture of face-to-face and telephone). This personal approach hopes to avoid discrepancies due to cultural differences.
In 2011, Brazil’s GDP grew around 3%, the second worst performance since 2004 and one of the lowest in Latin America. Experts predict that in 2012 GDP growth will continue modest for emerging markets standards: between 3,5% and 4%. Nonetheless, the level of optimism among Brazilian businessmen about the Brazilian economy increased 24 percentage points over the last quarter. As a result, Brazil assumed the third position in the global ranking; a huge improvement from the third quarter of 2011, when Brazil ranked 11th.
Brazil’s result defies global average, which stood at zero. Besides Brazil, the only countries where optimism grew were Armenia (16 % points), Greece (10 % points), China (8 % points), New Zealand (4 % points), the United States (3% points), and Ireland (6 % points).
Businessmen optimism has strongly declined all over Europe. The EU region has seen optimism levels fall from 49% in 2011 to 29% in 2012 - a reduction of 20%. In fact, Ireland is the only EU country where sentiment has improved in 2011. The countries that had the greatest declines in optimism were: Thailand (-94 % points), Malaysia (-60 % points) and Singapore (-41 % points).
In Latin America, optimism has also increased over the last quarter (+7 percentage points) to 61%. On the same hand, 24% of the businessmen in the BRIC countries (Brazil, Russia, India and China) are optimistic about the future of the economy of their countries in 2012, up 9% in comparison with the third quarter. Compared with the same period last year, businessmen’ optimism increased 14% in Latin America and 20 % in the BRIC.
Georgia heads the ranking of optimism with 78%, Peru comes in the second place with 77% and Brazil is third with 74%. The list also shows the Philippines (74%), fourth, and India (58%) in the fifth place. Among the most pessimistic, Japan occupies the first place again (-71%), followed by Spain (-62%).
Brazilians are well known for being optimists. One of the country’s main nickname is even “the country of the future.” This is mainly related to Brazil’s abundance of natural resources and yet low general standard of living (GDP per capita is around US$ 12,500 per year).
It is easy to perceive optimism in Brazil’s young generation as well. Inspired by a growing middle class and all-time low unemployment rate - 4.7% in December 2011, technically total employment - young Brazilians trust they will have higher standard of livings than their parents. By contrast, the general tendency among young adults in Europe is to believe that they will not outperform their parents’ achievements.
Brazilians are also very excited with the leadership of Dilma Rousseff, the country’s first female president. According to Datafolha, a renowned Brazilian research institute, Dilma has registered 59% popularity, all-time high after one year on mandate. The fight against corruption is the main reason for such an enormous approval rate. In the first 12 months of her 4-years mandate Rousseff has launched a crusade against corruption: seven ministers have already been sacked, six because of corruption scandals. (See: Investing in Brazil? Don't Overlook Hidden Costs).
Recent good news are also another main source of optimism. In the beginning of 2012, it was announced that Brazil has overtaken the UK to become the world's sixth-largest economy. Additionally, Petrobras’ recent oil discoveries motivated some optimist experts affirm that by the 2020s Brazil could become the fourth-largest oil producer only behind Saudi Arabia, Russia and the United States. (See: Will Petrobras Become the World's Largest Company? Brazilian Giant's Q2 Profits Jump 32%).
