Despite Brazil's covid-19 spike, Minister of Mines optimistic

Mines and energy minister Bento Albuquerque. Image courtesy of Wikipedia

The positive performance of Brazilian mining, even with the ongoing pandemic, reflects expectations of improvement in the country's economy, said Minister of Mines and Energy Bento Albuquerque on Thursday.

Talking to investors on an e-mineracao symposium, the minister said revenue from mineral production in H1 2020 was 1% higher than in the first half of 2019. According to Bento Albuquerque, the mineral surplus in the trade balance was $5.2 billion.

"The first assessments for the performance of Brazilian economy were not at all optimistic and showed shrinkage of around 8% of GDP, Albuquerque said.

Credit ratings agency Moody's recently lowered Brazil's 2020 economic outlook

"In the mineral sector, the World Bank estimated a 4.7% drop in commodity prices. Recent estimates point to a 17% drop in mining investments over the next 4 years. In the first months of the pandemic, the most optimistic forecasts projected a recovery in the economy only in the first quarter of 2021. Fortunately, we are not seeing any of this happen. "

The country, however, still fights to control the increase on covid-19 cases.

On Thursday evening, the federal Health Ministry reported that the country had passed two million confirmed cases and 76,000 deaths, ranked only behind United States.

Credit ratings agency Moody's recently lowered Brazil's 2020 economic outlook, warning that the country's recovery was vulnerable to deepening uncertainty about its ability to control the pandemic.

Albuquerque, who tested positive for covid-19 in March, mentioned government initiatives to ramp up mining production in the following months, such as offering more areas for mining, minimizing bureaucracy and expanding public and private financing modalities for enterprises.

Debate grew over expansion on mining areas in Brazil after the government unveiled a controversial bill in February that would allow commercial mining on protected indigenous lands. Environmentalists say that mining will speed up deforestation.

In 2019, according to government statistics, illegal deforestation caused by gold mining in Brazilian forests broke a record: 10,500 hectares of forest fell, an increase of 23% over the previous year.