Read more about the article A novela do Fed, escreve Otaviano Canuto
Cedulas, dinheiro, DOlar. Brasilia, 03-09-18. Foto: Sérgio Lima/Poder360

A novela do Fed, escreve Otaviano Canuto

Uma delicada transição está em curso na economia dos EUA. Tanto autoridades fiscais quanto monetárias já deram sinais claros de não contar com –e desejar– o retorno aos patamares de inflação prévios à pandemia, algo inclusive manifesto na mudança de 2% ao ano para média e não mais teto. Agora, que critérios adotar para considerar ser a hora de apertar para impedir que uma inflação acima de 2% contamine credibilidade e expectativas é algo ainda longe de clareza.

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Read more about the article The Global Economy and the Pandemic

The Global Economy and the Pandemic

There remains tremendous uncertainty and prospects of a post-pandemic recovery vary greatly across countries, as it is bound to happen at different paces. And the divergence of per capita incomes in the world is rising as an aftermath of the pandemic. The pandemic will leave scars in labor markets and income distribution, besides higher public debts as a legacy. A higher pace of automation of jobs, as well as a partial reversal of globalization are also to be expected.

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Read more about the article How to heal the Brazilian economy

How to heal the Brazilian economy

The Brazilian economy has been suffering from a double disease in the last few decades: a combination of anemia in productivity increases and an obesity of the public sector. On the one hand, the mediocre performance of productivity in Brazil in recent decades has limited its GDP growth potential. On the other, the expansion of public spending has become increasingly incompatible with such limits on the potential expansion of GDP, particularly since the growing public spending has not achieved commensurate socioeconomic results.

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Read more about the article Otaviano Canuto’s Infoparlament Keynote Speech on the Pandemic, Digital Transformation, Finance, and Taxing Tech

Otaviano Canuto’s Infoparlament Keynote Speech on the Pandemic, Digital Transformation, Finance, and Taxing Tech

Our Senior Fellow and former World Bank Vice-President, Otaviano Canuto, gave the Keynote Speech at Infoparlament online. Check out his though on the pandemic, digital transformation, finance, taxing tech and more in the video. For more related content, get to know our fellow & browse through his publications, videos & more here: https://bit.ly/3glwiny

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Read more about the article Financial Globalization and Inequality

Financial Globalization and Inequality

Inequality is nowadays one of the most important issues facing many economies around the world, not only in developing countries but also in advanced and emerging ones. Today, there is a new evidence that has been highlighted by several economists and international institutions and that shows that the fight against rising inequality is not only beneficial from an equity, political and social point of views but it is also beneficial from an economic point of view and can boost economic growth in the long run. In this podcast, Mr. Otaviano Canuto, Senior fellow at the Policy Center for the New South and a former vice-president at the world bank joined our economist Hamza SAOUDI to discuss the root causes behind the increase of within countries inequality and the main policies that African countries should prioritize in this critical time so to ensure a sustained and inclusive recovery.

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Read more about the article Brazil and South Korea: Two Tales of a Middle-Income Trap

Brazil and South Korea: Two Tales of a Middle-Income Trap

The middle-income trap may well characterize the experience of Brazil and most of Latin America since the 1980s. Conversely, South Korea maintained its pace of evolution, reaching a high-income status. Such divergence of economic growth can be related to their distinctive performances of domestic accumulation of technological and organizational capabilities. Their different approaches to global value chains and trade globalization reinforced such discrepancy in domestic accumulation processes.

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Read more about the article Recuperação global pode não salvar a América Latina

Recuperação global pode não salvar a América Latina

As enormes disparidades na disponibilidade de vacinas entre as economias avançadas e em desenvolvimento podem exacerbar o que o FMI chamou de “recuperações divergentes” - com terríveis consequências para a América Latina. Uma recuperação robusta nos Estados Unidos, União Europeia e China, embora amplamente benéfica para a economia global, esconde alguns riscos importantes para aqueles que ficam para trás. Uma recuperação pós-COVID bem-sucedida na América Latina deve ser definida como um ponto de inflexão para padrões de crescimento mais resilientes, inclusivos e produtivos.

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Read more about the article Global Recovery May Not Be Enough for Latin America

Global Recovery May Not Be Enough for Latin America

The massive vaccine disparities between advanced and developing economies may exacerbate what the IMF has dubbed “divergent recoveries” – with dire consequences for Latin America. A robust recovery in the United States, European Union and China, while largely beneficial to the global economy, conceals some important risks for those falling behind. A successful post-COVID recovery in Latin America should be defined as an inflection point towards more resilient, inclusive, and productive growth patterns.

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Read more about the article Natural Wealth and Growth in Sub-Saharan Africa

Natural Wealth and Growth in Sub-Saharan Africa

The conceptual framework of natural wealth that we approached in the previous video may be illustrated with cases drawn from Sub-Saharan Africa. With at least 250 million inhabitants in resource-rich African countries, natural assets are responsible for more than 80% of exports and 50% of government revenues in the region. As such, the high concentration of resource-rich countries in the area allows for direct comparisons with their resource-poor counterfactual regional neighbors. We compare rates of economic growth, poverty reduction, governance, and sources of productivity growth in resource-rich and resource-poor countries. We contrast the landscapes during the commodity boom with the current one during the pandemic crisis.

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Read more about the article Por que não temer a birra dos mercados dessa vez

Por que não temer a birra dos mercados dessa vez

A hipótese de superaquecimento da economia dos Estados Unidos este ano, reforçada pelos sinais de inflação mais alta, criou a percepção de que o Fed poderá se ver obrigado a reorientar sua política, antecipando seu taper e, eventualmente, subindo juros. Haveria alguma possibilidade de um taper tantrum 2.0, caso o Fed se veja obrigado a acelerar o curso por enquanto projetado para ocorrer, gradualmente, a partir dos próximos dois anos? Os riscos maiores para a economia brasileira estão alhures: todos gerados de dentro, não como os de um taper tantrum 2.0.

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Read more about the article Natural Wealth: Blessing or Curse?

Natural Wealth: Blessing or Curse?

Natural resource-richness is basically a blessing, as stocks of natural wealth are among the factors of production which help determine the output per worker of a country. But it may become a curse, depending on the quality of governance and on the policies adopted to cope with macroeconomic challenges that accompany it. Natural wealth as a blessing supposes that the use of non-renewable resources must correspond to some extent to its transformation into the other types of assets. Such transformation passes by production diversification over time. Natural wealth must crowd-in other activities rather than crowd them out. Blessing supposes governance features that avoid rent captures for patronage purposes and misallocation of resources, as well as appropriate policies to deal with macroeconomic challenges that come with resource richness, such as Dutch disease effects of booms, temptations to over-borrow, and periodic situations of commodity price busts.

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Read more about the article Are We on the Verge of a New Commodity Super-Cycle?

Are We on the Verge of a New Commodity Super-Cycle?

Some analysts have started to speak of the possibility of a new commodity price ‘super-cycle’ after the downturn since 2011. Although it is always possible to find moments of joint fluctuation, in which commodities remain for a long time above or below their long-term trends, differences among them matter. Copper is King! It is in metals, especially copper, lithium, and rare earth ones, that a strong bullish cycle is most evident.

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Read more about the article O cobre será o novo petróleo, escreve Otaviano Canuto

O cobre será o novo petróleo, escreve Otaviano Canuto

Os preços de commodities recuperaram suas perdas do ano passado, subindo mais de 25% até aqui em 2021 e, na maioria dos casos, já estão acima dos níveis prévios à pandemia. O pacote fiscal de infraestrutura proposto pelo presidente Biden nos Estados Unidos e a transição energética global para a descarbonização trarão impactos de demanda e preços diferenciados entre commodities. As matérias-primas necessárias para baterias e motores de veículos elétricos –lítio, terras raras– já estão vivendo uma euforia de mercado. O cobre, por suas propriedades de conduzir eletricidade, tende a ser usado 4 ou 5 vezes mais em carros elétricos que em carros movidos a derivados de petróleo. O petróleo, por seu turno, não estará em sintonia com a “recuperação verde”.

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Read more about the article The Middle-Income Trap

The Middle-Income Trap

The “middle-income trap” has become a broad designation trying to capture the many cases of developing countries that succeeded in evolving from low- to middle-levels of per capita income, but then appeared to stall, losing momentum along the route toward the higher income levels of advanced economies. We need to approach middle-income countries as being in a complex transition phase between accumulation and innovation-based economies. Individual middle-income country experiences of falling into a “trap” may be approached as cases of lack of or failing performance in footing the bill in terms of appropriate policies and institutions.

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Read more about the article Projeção de PIB melhor não tem ‘milagre’, afirma Canuto

Projeção de PIB melhor não tem ‘milagre’, afirma Canuto

Corrida contra a covid no país não tem sido vitoriosa e dita o ritmo de retomada, diz ex-diretor do FMI. "Tenho usado uma analogia médica desde 2012, 2013, não é que estou entrando na moda. Mas digo que o Brasil tem um problema estrutural, que é a combinação entre a anemia da produtividade e a obesidade do setor público. E as duas se alimentam. Temos que gastar menos em emendas, em remuneração do setor público e reduzir benefícios fiscais. A agenda de reconfiguração do gasto público tem que estar na ordem do dia. Do lado da produtividade, precisamos melhorar a qualidade do ensino e o ambiente de negócios através de reformas."

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