A small light is beginning to show at the end of the long tunnel that Brazil’s intense political-economic crisis went through. It seems that the last two turbulent years lived are becoming a thing of the past.
Brazil, the South American giant that was involved in one of the biggest crises in its history and was dragged through the mud by the most spectacular corruption case to be remembered, the well-known “lavajato” that caused the arrest of the president of the largest Brazilian company, Odebretch, and of several important Brazilian politicians, immersing the country in the longest and most important recessive process of the last 115 years, recovers his economic optimism.
A breath of fresh air
Different sectors welcomed the excellent news reported by the Instituto Brasileño de Geografía y Estadística (IBGE) about inflation closing at an acceptable level of 6.29% in 2016, as opposed to 10.67% reached 12 months earlier, the highest rate recorded in thirteen years in that country, accompanied by the drop in interest rates in the Central Bank.
The recovery of the “giant of South America” and its imminent return to the regional markets is excellent news for the economic development of the neighboring countries.
A Carnival of relief for Brazil
In spite of a context lacking joy and hubbub, this 2017 was not the exception for the Carnival arena. Sources from the Ministry of Tourism announced the success of the Carnival, thanks to the large number of visitors travelling all across the country, strengthening regional economies and creating numerous jobs. It is clear once again that this event is an important driver of national tourism.
Carnival in figures denoting the relief in the economy according to Ministry of Tourism:
In Salvador, hotel occupancy reached 95% and generated 200 thousand temporary jobs. 600,000 tourists exceeded by 9% the flow of visitors in 2016 – 10% international- injecting R $ 1.5 billion in the Bahian economy.
In Alagoas, hotel occupancy reached 90% with 31,000 beds occupied.
In Paraíba, hotel occupancy of 95%, represented 200,000 tourists.
Ceará hosted 112,000 tourists, which reflected in 84% of hotel occupancy and represented R $ 140 million in direct income to the state’s economy, 10% more than in 2016.
In Rio Grande do Norte, hotel occupancy was 89%.
In Recife, hotel occupancy was 95%, injecting R $ 1.2 billion in the economy of Pernambuco.
San Pablo recorded a 167.5% increase in the number of tourists in the Sambódromo and 203% increase in the street carnival. It showed a growth of 7.7% in 2016.
The city of Belo Horizonte celebrates the largest carnival in its history with 500 thousand tourists, reflected in 59% of hotel occupancy, an increase of 19% compared to 2016.
In Rio de Janeiro, where the carnival fun is still on, 1.1 million Brazilians and foreign tourists are estimated to have enjoyed the event, generating a turnover of about R $ 3 billion.
A great future ahead for the region in 2017
Emerging regional economies, especially Argentina, Chile and Uruguay, need the reinsertion of Brazil to face the global scenario of changes that are to come.
In terms of tourism, Brazil used to be the leading emitter of tourists in the region, especially to Argentina. Regarding flow of travelers, the great recession of that country made the travel sector suffer one of the worst falls in the last years.
In 2017, Brazil’s great challenge is to recover the economic growth while facing the political scenario of 2018, wrapped in uncertainties but still expecting winds of great changes.
Big brands bet on the emerging giant in 2017
While uncertainty still has an impact on decision-making and lead major players in the hotel industry to move cautiously, especially on the investment front, big brands are redoubling their bet on Brazil’s “back on track.”
Recently, Accor –the renowned French hotel chain- acquired the rights to manage 26 hotels of Brazil Hospitality Group (BHG) in Brazil, investing R 200 million, equivalent to 64.5 million dollars. The news was released on March 3 by both companies. In this way, Accor adds a total of 278 properties in Brazil, leading the sector in the largest South American market, where the company focuses its expansion after France, Germany and England.
Sebastien Bazin, president of Accor, said in a press release “Today Brazil is a land of major opportunities. This transaction is a new milestone in the history of AccorHotels in this country, where we have been a firm leader for decades.”
The outlook indicates that Brazil is starting to come back. Even when the scenario is still somewhat timid, the will is firm to regain the growth of the northern country and its undisputed position as the head of the region. It will be difficult, since trust is not something that is easily recovered, but all tells that it will succeed.