The Ceará economy has, once again, posted impressive results across the board. GDP growth has registered solid growth, services have soared and unemployment has fallen to pre-pandemic levels. Furthermore, the state is outperforming Brazil on all three accounts.
Higher GDP growth than Brazil
Latest estimates from the state point to an increase of 6.24% in Ceará GDP last year, almost two points ahead of the national rate (4.5%). The most recent figures (Q3 2021) showed robust growth between July and September. During this quarter, GDP in Ceará went up by 4.78% compared to a 0.1% decrease in Brazil as a whole.
A slight deceleration is expected in 2022, with Ceará forecast to register 1.6% GDP growth. Estimates for Brazil vary from 0.3% (IMF figures) to 1.4% (OECD).
Booming services sector
The increase in services is one of the reasons behind the solid GDP growth. The sector performed exceptionally well for the Ceará economy last year when they rose by 18% in Q4, almost double the national rate. In addition, October to December last year was the third consecutive quarter to register increases in services.
Transport saw the best performance with a rise of 23.3%. Tourism in Ceará also experienced a good year with a 19.5% increase in activity.
Unemployment down to pre-pandemic levels
There was also good news for the Ceará economy on the job front. In Q4 last year, unemployment fell from 12.4% to 11.1%, which translates to a drop of 3.4% in 12 months.
More significantly, the jobless rate at the end of the last year was the same as Q4 2019. As analysts point out, unemployment has fallen to pre-pandemic levels in Ceará.
Exports boost Ceará economy
Imports and exports experienced solid growth during 2021 in Ceará where high vaccination levels allowed a massive return to commerce in the state. As a result, exports from Ceará equalled almost 1% of Brazil’s total, the highest share ever and the state ranked 14th in the national table and 3rd regionally.
Exports to the value of US$2.7 billion left Ceará ports last year, an increase of 47.7% on 2020. Imports into Ceará totalled US$3.87 billion, up 60.4% in the year.
Looking forward to 2022
Against a national scenario of high inflation and presidential elections later on this year, the Ceará economy looks set for a better year than Brazil as a whole. Furthermore, inflation and higher interest rates will have less effect in the state, expected to grow between 1.6% and 3.5% this year.
Analysts point to two main factors behind the stronger growth. Firstly, progress in vaccination has been continual in the state, allowing the services sector to recover ground lost during 2020 and early 2021. And secondly, Ceará has one of Brazil’s healthiest balance books and a solid track record in public investment.