Cup drove foreigner expenditure to an all-time high in Brazil
Foreign tourists’ expenditure in the country amounted to US$ 797 million in June, up 76% from the same month last year.
São Paulo – Foreign visitors spent US$ 797 million in Brazil in June, up 76% from the same month last year, according to a communiqué on the foreign sector disclosed this Friday (25th) by the Brazilian Central Bank (BC). According to information from the Ministry of Tourism, the figures are an all-time high for the month and they may have been driven by the number of tourists who came to the country for the World Cup.
According to news agency Agência Brasil, in July until the 23rd, foreign tourists’ expenditure in Brazil amounted to US$ 609 million, up around 50% from July 2013.
“Besides increasing tourism to Brazil like never before, generating income and employment, foreigners were certain to have invested in a most pleasing tourist experience, after all, the grand majority (94.8%) of them claimed to intend to return here,” said the minister of Tourism, Vinicius Lages, in a communiqué released by the Ministry.
Brazilian overseas expenditure, however, is still higher: more than US$ 2 billion were spent in June, up 4.9% from the same month in 2013. The increase in foreign expenditure, however, made the travel account deficit decline by 17.3% and ended last month at US$ 1.2 billion.
Year-to-date, foreign expenditure in Brazil amounted to US$ 3.647 billion, up 4.8% from the first half of 2013. On the other hand, Brazilian overseas expenditure amounted to US$ 12.486 billion, up 2.27% in the same comparison.
The travel account deficit adds to the negative result in current account posted by the country. In June, Brazil’s transactions abroad posted a deficit of US$ 3.3 billion, and in the 12-month period amounted to a deficit of US$ 81.2 billion, equivalent to 3.58% of the Gross Domestic Product.
June’s deficit, however, was the lowest for the month since 2009. Besides the increase in foreign spending in Brazil, last month’s trade balance surplus of US$ 2.364 billion, and also the lower remittance of profits and dividends to foreign countries contributed to this result, according to Agência Brasil. In June, these remittances amounted to US$ 1.694 billion, as against US$ 2.223 billion in the same month in 2013.
According to the deputy head of the BC’s Economic Department, Fernando Rocha, the reason for the lower remittances is the smaller profit of the companies in Brazil due to moderate economic activity. There is also the influence of the exchange rates, which sets how much is sent abroad in dollars.
*Translated by Rodrigo Mendonça