Brazil
The publication looks at strategies to close the long-standing gaps with Brazil’s wealthier regions, as well as raising productivity in urban sectors, including manufacturing and services.
BY THE NUMBERS: BRAZIL
OVERVIEW: BRAZIL
Home to 205.3 million people and with a real GDP per capita of $10,616 (2024), Brazil is the largest country in Latin America. Despite its size and diversity, racial and gender inequalities continue to limit opportunities and keep many families in poverty.
Brazil spans 8.5 million km², with sharp regional contrasts. According to the Human Capital Index (HCI), a child born in Brazil today will achieve only 55% of their potential productivity with full access to health and education. Factoring in unemployment, this falls to 33%. Inequalities are especially stark: Afro-Brazilians, Indigenous peoples, and women face significant barriers, while HCI scores range from around 40% in the North and Northeast to 70% — comparable to OECD countries — in the wealthier Southeast.
Brazil’s natural resources position it to benefit from the global shift to low-carbon economies. Yet three-quarters of its greenhouse gas emissions come from land-use change and agriculture. Halting deforestation and scaling up climate-smart farming are urgent. The Amazon is approaching an ecological tipping point, threatening rainfall, agriculture, hydropower, and water supply across the region. Protection efforts must also cover other vital biomes such as the Cerrado.
Agriculture can be a driver of this transition by reducing deforestation, expanding sustainable land use, and boosting productivity. Brazil’s largely low-carbon energy mix also creates opportunities to cut emissions in transport, industry, and cities at relatively low cost.
The government’s Ecological Transformation Plan (ETP) and recent reforms aim to advance inclusive, sustainable growth, with a target of zero illegal deforestation by 2030. Reaching these goals will require coordinated action across sectors and levels of government—laying the foundation for long-term prosperity.
Last Updated: April 8th, 2026
Brazil’s economy has shown resilience, with average growth exceeding 3% over the past three years. Robust private consumption—supported by social transfers—has driven demand, while services and agriculture have led supply-side expansion. A growing labor market has contributed to reductions in poverty and inequality.
To sustain growth amid demographic shifts, Brazil needs further reforms to boost productivity, particularly outside agriculture. Key priorities include improving the business environment, fostering innovation and trade openness, strengthening education, increasing savings and infrastructure investment, and enhancing climate resilience. The recent indirect tax reform is expected to improve productivity, lower compliance costs, and simplify the tax system. However, an aging population will put pressure on public finances.
Real GDP grew by 3.4% in 2024, but is projected to slow to 2.3% in 2025 and to 1.6% in 2026 due to higher interest rates, a weaker external environment, and slower household consumption. Inflation is forecast to gradually decline to 4.2% by 2027, within the Central Bank’s target range. Poverty (at $6.85/day) decreased from 21.7% in 2023 to 20.9% in 2024, supported by strong job creation (2.8 million new jobs), record-low unemployment (6.2%), and a 4.8% increase in real wages. However, poverty reduction may slow due to limited fiscal space and slower growth in services, which employ 80% of the poor.
The primary fiscal deficit narrowed from 2.3% of GDP in 2023 to 0.3% in 2024, reflecting higher revenues and lower expenditures. Gross public debt increased from 73.8% to 76.5% of GDP, mainly due to higher interest payments. Budget rigidity and indexed spending constrain fiscal space for investment. Addressing age-related spending, especially pensions, and broadening the tax base are crucial for fiscal sustainability.
Brazil maintains solid macroeconomic buffers, including ample international reserves, low external debt, a credible Central Bank, and exchange rate flexibility.
Last Updated: April 8th, 2026
Progress in Brazil has global significance, as improvements in living conditions within the country can positively impact the world, and vice versa. The World Bank Group is dedicated to supporting Brazil’s efforts to accelerate productivity growth and reduce poverty and inequality, all within a framework of fiscal and environmental sustainability. This commitment aims to build a future with opportunities for all and to help Brazil realize its potential as a leader in green and climate-friendly development.
Demand for World Bank Group support in Brazil is substantial. The International Bank for Reconstruction and Development (IBRD) currently manages a portfolio of 56 projects, totaling $10.07 billion in commitments. This includes 44 investment projects ($5.59 billion), nine development policy operations ($3.98 billion), and three program-for-results operations ($498.3 million).
Requests for IBRD financing from states, municipalities, and federal ministries often surpass the volume of federal guarantees allocated by the Union to international financial institutions (IFIs), which are necessary to enable lending. This strong demand, combined with Brazil’s diverse development challenges, calls for innovative programming and a more ambitious approach to the World Bank Group’s joint efforts to mobilize private capital and improve markets.
The IFC support for the private sector—through loans, equity investments, and advisory services for project structuring—has increased year after year, contributing to economic growth and job creation in Brazil. IFC committed $11.6 billion in new investments in the country during the fiscal year ending in June 2025, including both its own resources and funds mobilized from third parties. With an investment portfolio totaling $7.1 billion in FY25 , Brazil now represents IFC’s second largest investment portfolio worldwide.
While investor demand for MIGA guarantees has historically been low, it has begun to grow: total gross exposure rose from $101 million in March 2024 to $1.55 billion in July 2025, with new investments in renewable energy, infrastructure, financial inclusion, and climate projects.
Last Updated: April 8th, 2026
The World Bank Group’s Country Partnership Framework (CPF) for Brazil for FY2024–2028 is designed to help Brazil build a more productive, inclusive, and sustainable economy.
The CPF is closely aligned with Brazil’s Federal Government’s 2024–2027 Multi-Year Plan (PPA) and the Ecological Transformation Plan (ETP). It focuses on three main outcomes: greater productivity and employment, greater inclusion of poor and underserved populations, and a greener economy with reduced vulnerability to climate shocks.
Key priorities include fiscal consolidation, improving government effectiveness, and regulatory reforms to lower transaction costs and boost competitiveness. The CPF supports inclusive and sustainable development, better management of natural resources, expansion of clean energy, and the development of green and resilient cities.
It also emphasizes strengthening social protection and education for disadvantaged groups, advancing institutional reforms, promoting transparency, and fighting corruption. Mobilizing private capital is a central goal, with IFC and MIGA playing key roles. The CPF encourages close collaboration with development partners.
The previous CPF, covering FY2018–2023, was significantly adjusted in the 2022 Performance and Learning Review to respond to the COVID-19 pandemic.
Last Updated: April 8th, 2026
In the area of People, the World Bank has supported Bolsa Família, which lifted millions out of poverty and set benchmarks for transparency and crisis response. It has contributed to education reforms in Ceará, inspiring changes nationwide, and supported the Unified Health System (SUS), recognized as one of the world’s most advanced public health systems. The Bank has also promoted opportunities for indigenous peoples, Afro-Brazilians, women, and youth, advancing legislation on social responsibility, violence prevention, and reducing disparities.
For Prosperity, the World Bank Group backed Brazil’s first public-private partnership (PPP) in São Paulo Metro Line 4 and has since supported a PPP program that unlocked $8.5 billion in private investment over a decade, improving urban mobility and services. Its analytical work and technical assistance have helped advance fiscal and structural reforms, including the 2019 pension reform, the state borrowing capacity classification (CAPAG), and indirect tax reform. Initiatives like the Progestão series support fiscal efficiency and management reforms in various states and cities.
On the Planet pillar, since the 1990s, the World Bank has supported Amazon land demarcation, community reserves, certified forest management, and institutional strengthening. It has led efforts in the Cerrado and Caatinga biomes for sustainable water, agriculture, and land management. The IFC pioneered sustainable finance instruments, such as the first sustainability-linked and blue loans, social bonds, and zero-deforestation loans. In 2023, Brazil issued its first sovereign sustainability bond, supported by the World Bank Group and IDB, opening new opportunities for sustainable financing.
The World Bank Group will continue to prioritize high-impact engagements that go beyond the scale of its financing, supporting Brazil’s development across these pillars.
Last Updated: April 8th, 2026
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