Brazil’s shadow economy is a significant problem that has been affecting the country’s economy for years. A recent study by the National Confederation of Industry revealed that illegal activities such as contraband, theft, piracy, and tax fraud have resulted in a staggering loss of BRL 453.5 billion (USD 85 billion) annually. This figure is so large that if the shadow economy were classified as its own state, it would rank as the sixth-largest local economy in Brazil.
The impact of the shadow economy goes beyond financial losses; it also affects job creation. The study found that 370,000 formal jobs were not generated in 2022 due to the presence of the illegal economy. The clothing industry was hit particularly hard, with 67,000 jobs failing to materialize due to illegal activities.
The feud between the House and the government continues to escalate today as Congress prepares to hold a hearing on Twitter Files Brazil. The ongoing conflict has caused uncertainty and instability in the country’s political landscape. However, it is clear that addressing issues like Brazil’s shadow economy is crucial for ensuring a stable and prosperous future for all Brazilians.
