By Walter Brandimarte and Tiago Pariz
RIO DE JANEIRO Jan 8 Brazil recorded a net
foreign exchange outflow of $12.3 billion in 2013, the first
negative result since the global financial crisis in 2008, and
the worst deficit since investors panicked over the election of
President Luiz Inacio Lula da Silva in 2002, central bank data
showed on Wednesday.
As Brazilians continued to buy imported goods and travel
abroad, while foreign investment dwindled and exports slid, the
foreign currency deficit ballooned last year, helping the real
currency to lose more than 13 percent in value.
Not too long after complaining about a "tsunami" of dollars
flooding the Brazilian economy, President Dilma Rousseff now
faces a struggle to attract enough foreign investment to boost
the economy and finance a widening current account deficit.
Dollars are also needed to stabilize the real, which is
expected to further weaken this year, potentially fueling
The deficit was the result of a sizable $23.4 billion
outflow in the country's financial account, which includes
foreign direct and portfolio investment. Many investors have
been reluctant to invest in Brazil due to what they consider
erratic government policies.
The trade account, meanwhile, recorded a modest net inflow
of $11.1 billion as Brazil's trade surplus fell in 2013 to its
lowest level since 2000.
"The international scenario is more complex for Brazil and
other emerging market countries," said Rafael Bistafa, an
economist at Rosenberg & Associados, a consultancy in Sao Paulo.
"But that does not mean we have a capital flight, nor is such
the outlook for Brazil going forward."
Bistafa forecasts that Brazil will have "persistent and
moderate" dollar outflows through 2014, when a presidential
election in October could add to market volatility.
The 2013 foreign-exchange deficit compares with a net
surplus of $16.7 billion in 2012 and a whopping $65.3 billion
surplus in 2011, when the real gained to nearly 1.5 per dollar.
Earlier this year, the currency weakened to 2.4 per dollar.
In 2008, when investors fled emerging markets during the
global financial crisis, Brazil posted a net forex outflow of
$983 million. In 2002, when investors feared the policies of
Lula's first government, nearly $13 billion left the country.