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Drought hinders Brazil's economic recovery

Tuesday, February 24, 2015

Subject

The impact of the continuing drought in the southeast.

Significance

Brazil continues to suffer an unprecedented drought which, combined with lack of investment in production and wasteful consumption of water, is affecting most of its largest cities. In addition to increasing popular discontent with economic turmoil, the water crisis is limiting prospects for recovery this year as it has seriously affected the southeast region -- including Sao Paulo, Rio de Janeiro, and Minas Gerais, the states responsible for half of Brazilian GDP.

Impacts

  • Most citizens blame public authorities for the shortage, although rainfall is well below the historical average.
  • In Sao Paulo, contingency measures implemented have reduced water consumption, but there is still a risk of rationing.
  • After the end of the Southern Hemisphere summer in March, rainfall levels are expected to fall further.
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