Roberto Campos Neto calls for urgent Brazilian fiscal adjustment

Former Central Bank President Roberto Campos Neto has called for an urgent fiscal adjustment in Brazil, stating that the need to balance public accounts is “unpostponable.” In an article published in Folha de S. Paulo, Campos Neto argued that for two decades, various administrations have followed a pattern of “promising now, paying later.”

He highlighted that Brazil’s gross debt reached 82.5% of GDP in July 2026, totaling R$ 10.9 trillion. Interest payments alone consume approximately 8.7% of GDP annually. Campos Neto noted that with interest rates around 14% per year, the debt arithmetic has become “openly hostile,” as the cost of financing the government significantly exceeds the rate of economic growth.

He attributed the current fiscal pressure to several structural factors, including constitutional floors for health and education, pensions indexed to the real minimum wage, expanded transfers, tax exemptions, and successive relaxations of fiscal rules. He warned that Brazil enters the second half of the decade with visible pressure on its public finances.