Brazil will remain one of the fastest-growing nations in the coming years after overtaking the U.K. this year to become the world’s sixth-largest economy, the country’s Finance Minister Guido Mantega said.
“The countries that will grow the most are the emerging markets such as Brazil, China, India and Russia,” Mantega said in a statement published on the finance ministry’s web site, referring to findings by the London-based Center for Economics and Business Research, or CEBR. “The trend is for Brazil to remain one of the world’s top economies.”
The CEBR echoed forecasts earlier this year by the International Monetary Fund showing that Brazil’s $2.5 trillion economy had overtaken the U.K. to become the world’s sixth-largest. The IMF expects Brazil to climb past France to become the fifth-largest economy by 2016.
While Brazil’s economic growth is forecast to slow from 7.5 percent in 2010 to 3 percent this year, that’s still faster than the 0.9 percent growth economists expect from the U.K., according to Bloomberg surveys.
Brazil’s emergence as an economic power has bolstered the country’s demands for more say in multilateral lending institutions, such as the IMF, and for a permanent seat on the United Nations Security Council.
Rising real wages and a boom in credit have also fueled demand by Brazilian consumers in recent years, with an emerging middle class going on a shopping spree for new cars and refrigerators.
Foreign companies are seeking to profit from the nation’s growing pie. Foreign direct investment has jumped to a near-record $75 billion in the 12 months through November, up from $38 billion a year earlier, according to the central bank.
Even while Brazil’s growth outlook looks assured, the country has much to do to improve living conditions, Mantega said today.
“European countries have much higher per capita income than we do,” the 62 year-old former economics professor said. “We’ll need 10, 20 years to reach European standards.”
While Brazil’s population of 191 million inhabitants is more than three times that of the U.K., its gross domestic product per capita based on purchasing power parity is roughly one-third, according to the World Bank.