Brazil's industrial production fell 12.4 percent in December compared with November and was down 14.5 percent year-on-year, according to a study released on Tuesday by the Brazilian Institute of Geography and Statistics (IBGE).

It is the worst result registered since the beginning of the study in 1991. With the decrease, Brazil's industrial production returned to March 2004 levels.

In 2008, production was up 3.1 percent compared with 2007. In the fourth quarter of 2008, industrial production was down 9.4 percent from the third quarter, a fall of 6.2 percent year-on-year.

According to the IBGE study, the international financial crisis had a direct impact on Brazil's industrial production levels, since the restriction of credit affected sectors heavily dependant on loans, such as the automotive. In addition, the crisis also affected commodities exports.

The study states that 25 out of the 27 sectors analyzed registered production decrease in December. The only exceptions were the paper and cellulose sector, which witnessed a 0.4-percentincrease in production, and the transportation devices (excluding cars) sector, which had a 6.7-percent rise.

The most significant impact on industrial production levels was registered in the vehicle manufacturing sector, where production dropped 39.7 percent in December, as a consequence of several stoppages and collective vacations given by larger companies.

(Xinhua News Agency February 4, 2009)