Reduced Rainfall Costs Brazil US$ 14 Billion per Year

Since 2012 the lack of rain has impacted 17% of GDP; global warming prolongs drought

São Paulo

The scarcity of rain, increasingly frequent in Brazil, causes the country an estimated annual loss of around R$ 80 billion (US$ 14 billion) in Gross Domestic Product with its effects on energy and food production.

Although the scenario has worsened this year, rainfall has been below expectations since 2012.

The economist behind the calculation, Bráulio Borges, from LCA Consultores and Brazilian Institute of Economics, of the Getulio Vargas Foundation, points out the low intensity of rainfall as one of the factors that contributed to the lost decade of GDP, although it used to be ignored.

The economist concludes that the lack of rain had an accumulated impact equivalent to 17% of GDP from 2012 to 2021.

The World Bank projects that, with global warming, Brazil will remain drier, with rainfall 10% below average in the coming years. The UN climate panel predicts a similar picture.

The biggest loss (R$ 50 billion annually) results from the direct effects of the drought: higher energy costs and food inflation.

The rest comes from factors such as the drop in consumption due to greater use of household income for food and electricity and the consequences for tourism and transport.

Translated by Kiratiana Freelon

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