In its December report, the BCP was optimistic about the evolution of the health situation and linked the rebound in the economy to it, but 4 months later, with the return to restrictions, the uncertainty weighs 0, 5 percentage point on the increase. The primary sector, the most affected in the 2021 forecasts, improved compared to December and cushioned the decline from 3.5% to 2%. Within the primary sector, agriculture will be the most affected, with an estimated contraction of 5%, while animal husbandry expects to achieve growth of 8.5% thanks to the expected meat demand from Chile and France. ‘Israel, where relies on a resumption of consumption thanks to the vaccination of its population. Between December and April, the BCP also lowered estimates for the secondary sector, albeit in minimal numbers, from 5.2% to 5.1%. BCP’s biggest doubt for this sector is the behavior that construction and infrastructure will show this year, on which the government has based one of the pillars of post-pandemic economic recovery. If an expansion of 5.5% of public works and civil engineering is estimated, the BCP does not exclude that, faced with the health emergency, the executive is forced to redirect public works funds to health and therefore force a construction withdrawal. In fact, the fears of the BCP are not far from reality, since this month the government postponed the tender for the construction of a bridge with Brazil with the intention of allocating this amount. to the health system. For the tertiary sector, the BCP makes its most marked downward revision in this latest report, from growth of 5% in December to 3.7% today. This estimated decrease is explained by the gradual return to fiscal rule and a moderation in current and capital spending by the government, after a 2020 public investment to deal with the pandemic. Likewise, optimism about the resumption of border trade is also lost, due to restrictions in both Paraguay, Argentina and Brazil, countries to which are added the high numbers of infections. BCP also does not forecast a good behavior of internal demand for this 2021, due to new mobility restrictions and the rapid spread of the virus in the country. Private consumption will be constrained by the inability to access certain goods, especially services, and by postponing consumer spending until uncertainty begins to dissipate. Con estas perspectivas, el BCP rebajó del 5% al 3.4% el crecimiento del consumo privado para este 2021 observed the misma tendencia para el consumo público, que pasa del 3.5% en el inform de diciembre al 1.5% in April. The BCP improved the forecast for external demand, with a reduction from its 13.6% drop estimated in December to a contraction of 0.2% in the April report for 2021. In international trade, the BCP s ‘expects a “significant dynamism” with exports of beef and wheat and imports of machinery and equipment for agricultural activity. The evolution of the coming months will be marked by the evolution of health measures and the vaccination campaign, the behavior of the GDP will therefore depend on “uncertainty” about the situation. The Paraguayan economy fell 1% in 2020, according to data from BCP.
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