Chris Sloley – CityWire, 07/20/2012
Brazil will only be badly hurt by the Chinese slowdown in growth if it becomes a structural issue and the Brazilian government fails to react, according to Citywire A-rated manager Alex Duffy.
Duffy, who co-manages the $2.2 billion Fidelity Funds – Latin America fund with Angel Ortiz, said Brazil is well positioned to counter cyclical swings but if it becomes a longer-term issue then it would need to address its own views on growth.
‘The biggest risk for Brazil is that if there is a cyclical slowdown in China and fixed asset investing in China slows and the issue turns out to be to structural,’ said Duffy.
‘If the Brazilian government don’t instigate a range of structural reforms to take this into account, and instead continues to counter it with short term cyclical measures, it is a big risk.’