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Brazil launched the world's biggest poverty reduction programme and a large-scale social housing programme. In addition, large parts of the country were connected to the power grid and headway was made on reforming land rights.
While nearly one fourth of the Brazilian population was still living in extreme poverty in 1990, that rate had dropped to 3.3 per cent by 2014. By 2019, however, it had gone back up to 5.4 per cent. The COVID-19 pandemic has hit disadvantaged and vulnerable sections of the population particularly hard and led to a further increase in poverty. People's access to adequate food has deteriorated significantly as well. According to a study carried out in the first half of 2022, over 125 million people – more than half the population – do not enjoy food security. According to the study, about 30 million people are experiencing hunger.
While comprehensive social protection programmes mitigated the impact of the pandemic, this simultaneously increased many households' dependence on public transfers. Moreover, these activities – just like the financial assistance for enterprises (see Economic situation) – drove up government debt.
The World Bank expects that the positive impact of the COVID-19 programmes will be short-lived and says that there is a chance that the recovery of the labour market will not fully compensate for the reduction in government transfers, leading to higher poverty rates. According to the World Bank, striking the right balance between protecting the poor and ensuring sustainable public finances will be a key policy challenge in the years ahead.
The differences in the distribution of property and income between the regions and between different groups within the Brazilian population are considerable. Brazil’s Gini coefficient (External link) – a measure of income inequality – is one of the highest in the world. Indigenous and Afro-Brazilian population groups are especially socially and economically disadvantaged.