IMF Revises Forecast and Says Brazil in 2010 Will Grow Over 3.5%

Buildings in São Paulo, BrazilThe director of the Western Hemisphere Department at the IMF, Nicolas Eyzaguirre told reporters, in a press conference in São Paulo, southeastern Brazil, that the growth of Brazil in 2010 should be higher than previously forecasted by the institution, 3.5%.

Eyzaguirre also pointed out that one of the ways to avoid a new recession would be the establishment of a global insurance to avoid the world economy remaining dependant on the production of dollars by the United States.

"If everyone accumulates reserves in dollars, the United States have an enormous subsidy and we do not use this money for other things, like education and infrastructure. We need a multilateral organization that is not the Federal Reserve (Fed) to do this regulation."

He also emphasized that, in case there is a firm financial system, there may be a return to the credit crisis. "This is a possibility that we cannot discard."

Antônio Henrique Silveira, Economic Follow-up secretary of Brazil's Finance Ministry, who also participated in the press conference, said that the government of Brazil sees the stimulation of credit as the first step for recovery after the crisis.

Different from the IMF report for Latin America and the Caribbean, which states that there is no relation between international reserves and the recovery of emerging nations, Silveira said that the accumulation of reserves by the country contributed to mitigating the crisis and should be maintained.

Regarding the North American interest rate, the IMF document showed that the Fed needs to keep it low. "Then, the United States is going to enter a deflationary spiral. In our point of view, the risk of this happening is very great," said Eyzaguirre.

Regarding the tax on foreign investment in Brazil, the IMF director said that the organization cannot comment on the matter, as it is a matter of fiscal policy sovereignty, but added that the IMF recommendation to Brazil is that the "entry of foreign capital be made safe."

Anba

Tags:

Ads

You May Also Like

A Brazilian and His Bike Spend 3.5 Years Visiting 28 Countries in 5 Continents

Brazilian architect Argus Caruso Saturnino, 31 years of age, has already travelled to Egypt, ...

Brazil: EU to Eliminate Surtax to Mercosur Products

The trade negotiations now underway between Mercosur and the European Union, which are scheduled ...

Brazil Wants to Export More than the Current 1% of Germany Needs

Brazilian exports to Germany are still far from meeting that country’s current demand and ...

Brazil’s US$ 5 Billion Deficit After Brazilians Go on a Shopping Spree Overseas

In July, the month of school holidays, expenditures by Brazilians in foreign countries totaled ...

A World’s First: Brazil Shows Live NBA Games on Internet

The American National Basketball Association announced that a Brazilian Web portal will be the ...

Third Place Marina Silva Big Winner and King Maker in Brazil’s Presidential Election

Dilma Rousseff chosen by Brazilian President Luiz Inácio Lula da Silva to succeed him ...

Enduring Scandal Drags Brazilian Stocks Down

Latin American markets were mostly weaker today, as Brazil posted a more meaningful decline ...

Children as Young as 5 Work in Brazil’s Talc Mines

Child labor continues to pervade supply chains throughout the Brazilian economy. This observation was ...

From Slaves to Immigrants

The search for a replacement for slave labor in Brazil began in earnest in ...

Brazilian Stocks Follow US into Black Territory

Brazilian shares were higher today, ending a gloomy string of sell offs prompted by ...