Luiz Inácio Lula da Silva, the president of Brazil, warned his fellow citizens of a "worrisome and tough" first quarter but promised the government is prepared to inject more resources into the economy to help fight the effects of the global crisis and stimulate activity.
One of the moves will be to free more credit for the private sector from Brazil's National Development Bank, Lula said during his weekly radio show, "Breakfast with the president".
Later in the day during a visit to São Paulo, in the Brazilian Southeast, the president said that the government "will have more measures to announce this month," but declined to offer specifics. "We're prepared to boost the private sector so they continue to invest and create jobs".
Brazilian industry and agribusiness that depend heavily on exports have been hit hard by falling international demand for the country's products. The government has already freed up billions of dollars in emergency credit lines and tax breaks to help prop up the private sector.
According to Luciano Coutinho, the Brazilian Social Development bank CEO, the institution is planning to invest approximately US$ 50 billion in 2009.
Last Friday government owned Banco do Brasil SA said it will pay 4.2 billion reais (1.8 billion US dollars) for a stake in the banking unit of one of the nation's biggest conglomerates to help ease credit in the region's largest economy. The bank will buy a 50% share in Banco Votorantim SA, owned by family-controlled Grupo Votorantim.
The Brazilian economy is forecasted to expand 2% in 2009 after having recorded 5% in 2008 and over 6% in the previous year.