Jim O'neill, Goldman Sachs chief economist has said that the Brazilian economy has come through the global economic crisis extremely well and is set for 5% growth in the next few years.
His statements have been picked up by the media but no one has mentioned that 5% growth is a very cautious forecast for the Brazilian economy's growth in the next few years.
Brazil is a production powerhouse, with the potential to become one of the world's biggest exporters. Despite its having among the largest stocks of cattle in the world, Brazil is also embracing the world's great growth sectors like renewable energy, thus future proofing the economy to as great an extent as that is possible.
Brazil's economy grew at 5.4% in 2007 and 5.2% in 2008, so to say it will resume growth at a similar rate in the next few years is a very cautious forecast indeed. Especially considering other countries in the region like Panama, which grew at around 10% in the past few years.
The global financial crisis did great damage to Brazil, but after such a scything growth should restart at an accelerated level, because the environment is conducive to greater growth.
This is true in the property market as well. Because Brazil property prices haven't grown in the way that they were forecast to, and probably won't this year, this means that international investors can still pick up some great bargains in the country -- although they will be disappointed that prices haven't fallen.
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