Brazil’s economy seems to have turned the tide on a near two-year recession by posting growth of between 0.7 per cent and 0.8 per cent in the first quarter of this year.

This growth is in stark contrast to the end of last year when Latin America’s largest economy shrank by 0.9 per cent – its eighth straight quarter of retreat.

The boost to the economy can in part be attributed to the recent strong performance of Brazil’s agricultural sector, which is expected to harvest record crops. Nowhere is success more evident than in the forestry sector, making it a prime time to invest.

In the years since the recession began, the economy contracted 3.6 per cent and 3.9 per cent, and unemployment hit a record 13.7 per cent with more than 14 million Brazilians looking for work.

Henrique Meirelles has named Brazil’s costly social security system as the main cause of the budget deficit, and insisted that reforming it would create jobs and boost growth, despite its unpopularity.

For example, changes to the pension system which will extend the number of years Brazilians must work to retire on full benefits, are opposed by 71 per cent of those surveyed by pollster Datafolha.

Pension reform is a contentious issue in Brazil, which has one of the world’s most generous social security systems, allowing retirement on average at the age of 54 with almost full benefits, compared with 72 years in Mexico.

The government coalition is currently trying to secure votes in favour of over-hauling its existing social security system. They’ve delayed a vote in the full house to buy them more time to muster the 308 votes needed.

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