Brazil's Economic Growth and Business Environment Boosts Through Regulatory Reforms

Brazil is set to achieve significant economic expansion during President Luiz Inácio Lula da Silva's third term, with GDP expected to grow by 10.9% over the 2023-2026 period. These projections come amid efforts to improve the country's business climate, particularly at the municipal level through regulatory reforms.

According to the Brazilian Institute of Geography and Statistics (IBGE), Brazil's GDP grew 3.2% in 2023 and 3.4% in 2024, with projections of 2.1% in 2025 and 1.7% in 2026, surpassing growth rates seen under the previous administration. The Austin Rating highlights that family consumption has increased by 12.7%, bolstered by public spending and income transfer programs costing R$441 billion projected for 2025. Inflation is forecasted to average 19% cumulatively over the four-year term, the lowest since the Real Plan, despite high interest rates of 15% per annum with accumulated interest reaching 60.8%.

These macroeconomic gains are complemented by state-level initiatives designed to foster entrepreneurship and reduce bureaucratic barriers. The Goiás government has signed a Cooperation Agreement with the Institute of Freedom and Leadership (Ilisp), facilitated by the State General Secretariat and the Mauro Borges Institute. This partnership supports the implementation of the Economic Freedom Law (Law No. 22,612/2024 and Decree No. 10,500/2024), exempting 962 economic activities from permit requirements and significantly simplifying local regulations.

An IMB study reveals municipalities adopting this law have experienced a 30% average increase in new company registrations and up to a 70% reduction in the time required to open businesses, stimulating job creation and local economic activity. Adriano da Rocha Lima, Secretary-General of Goiás, emphasized the importance of this partnership to extend economic freedom benefits through enhanced legal security and decreased bureaucracy.

By 2026, the agreement aims to mobilize at least 100 municipalities, provide technical support to 60 city halls, and ensure alignment with state policies, all without financial transfers. This initiative represents a national benchmark in regulatory simplification, supporting Brazil's broader goals of sustained economic growth and improved business environments.