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Posted 6/24/2022 11:13 am Updated 6/24/2022 11:14 am

Aid Brazil of at least R$ 400 reduces poverty and injects resources into the economy of municipalities

The IPEA publication points out that pessimistic forecasts made in 2020, of an increase of up to 7% in the poverty rate in the country due to the COVID-19 health crisis, were reversed by the Federal Government's social programs. - Photo: Ministry of Citizenship

 

Since it entered into force in November 2021, Auxílio Brasil has contributed decisively to the fight against hunger and poverty in the country, in addition to participating in the process of recovering the economy of municipalities in the face of the COVID-19 health crisis. 19. These are some of the conclusions of studies released this week by the Federal Government, through the Institute of Applied Economic Research (IPEA), and the Federal University of Pernambuco (UFPE).

 

The IPEA publication, entitled “The effect of covid-19 on Brazilian poverty indicators and mitigation policies: an initial discussion”, points out that pessimistic forecasts made in 2020, of an increase of up to 7% in the poverty rate in the country due to the health crisis, they were reversed by the Federal Government's social programs.

 

A study by researchers Andy Sumner, Eduardo Ortiz-Juarez, and Chris Hoy, from the University of the United Nations, even projected that Brazil would be responsible for 30% of the new poor in Latin America, as the poverty rate in the country would increase by almost 7 points percentages. In other words, more than 14 million Brazilians would live below the poverty line.

 

IPEA research shows how mechanisms created by the Federal Government, including Emergency Aid, in 2020, and Auxílio Brasil, at the end of 2021, protected Brazil in a scenario of a 16% increase in world poverty.

 

The study signed by the president of IPEA, Erik Alencar de Figueiredo, assesses that, by including 3.5 million families, in January and February 2022, the Federal Government managed to absorb the contingent of 1 million families affected by the shock of the health crisis. of COVID-19.

 

When discussing possible public policies to combat poverty, the IPEA document again deals with Auxílio Brasil: “A good strategy for effectively overcoming poverty must rethink the design of the social program, considering the program’s interaction with the labor market and with education and health systems”.

 

This is precisely the concept implemented by Auxílio Brasil, which offers tools for socioeconomic emancipation through complementary benefits, such as the Rural Productive Inclusion and Urban Productive Inclusion Grants, the Junior Scientific Initiation Scholarship, and the Escola Esporte Auxílio.

 

cities' GDP

The economic impact of Auxílio Brasil is highlighted in a study carried out by economist Echo Costa, professor at the Federal University of Pernambuco (UFPE), in partnership with P3 Inteligência. Based on data from the Ministry of Citizenship and the Brazilian Institute of Geography and Statistics (IBGE), Costa concluded that the Federal Government's permanent income transfer program causes an increase of at least 10% in the local economy in 648 cities - 11, 6% of all Brazilian municipalities.

 

The injection of resources that makes the economy turn is more visible in the Northeast Region. Bahia (146), Piauí (124), and Maranhão (116) are the states with the highest number of cities in which the amounts paid by Auxílio Brasil, between January and May of this year, represent 10% or more of the Gross Domestic Product (GDP) municipal. In 15 of the 27 Federation Units, the program has consistently boosted the state's GDP.

 

The Federal Government's investment in June exceeds R$ 7.6 billion. The average ticket received by families is R$ 402, more than double when compared to the previous social program. The resources planned for the payment of Auxílio Brasil in 2022 tripled last year's budget, reaching around R$ 90 billion.

 

Emergency Aid

The recognition that Brazil acted efficiently in mitigating the socioeconomic effects of the COVID-19 health crisis had already been registered in the last two years by several international organizations. The agility in the implementation of Emergency Aid was praised, for example, by the International Monetary Fund (IMF).

 

In a report released in December 2021, the IMF highlighted that the Federal Government responded quickly to the crisis and that up to 23 million citizens were lifted out of extreme poverty at the height of the COVID-19 health crisis.