• Categories
  • Archives

70% of Brazil’s Capital Abroad Are in Fiscal Havens

Brazilian holdings overseas increased 14,6% in 2004 totalling 94,7 billion US dollars according to the latest report from the Brazilian Central Bank, which attributes the expansion to the greater internationalization of the country’s economy.

But the figure, which in 2003 represented 10,8% of Brazil’s GDP and 11,7% of GDP in 2004, has been mostly (70%) concentrated in fiscal havens such as Cayman islands, Bahamas and British Virgin Islands.


Other destinations include United States and Uruguay, reveals the bank report.


The Central Bank also revealed that total foreign investment in Brazil, according to the latest available data from September 2004, reached US$ 412 billion, while Brazil’s assets overseas totalled US$ 143.4 billion with a negative balance of US$ 268,7 billion. This means Brazil is a net recipient of foreign investment.


However a report from the Financial Action Task Force on Money Laundering and distributed by the International Monetary Fund, criticizes Brazil for limiting local fiscal authorities activities.


The group specifically created in 1989 by the G7 to combat money laundering and terrorism financing, nevertheless recognizes advances in Brazil’s financial legislation, the creation of the Assets Recovery and International Justice Cooperation Committee, COAF, and several specialized offices at federal level.


But the reports highlights that the “rigidity” of Brazil’s banks secrecy laws and procedures remain as an “obstacle” for COAF.


Meantime and in spite of the political commotion over alleged corruption actions by President Luiz Inácio Lula da Silva’s administration, the Brazilian government announced this week it had successfully fulfilled its capital needs for 2005 totalling US$ 6 billion with the floating of US$ 600 million in sovereign Global 2015 bonds at 7.732%, a few points below the previous operation last February at 7.9%.


Apparently some positive indicators had a greater influence than expected: Brazil’s international risk rate currently stands at 409 points; inflation seems to be soft landing with growing chances of reaching the 5.1% government target for 2005; trade surplus is forecasted in 35 billion US dollars and last week the Central Bank after nine months of consecutive increases, left the basic SELIC interest rate unchanged at 19.75% with prospects of an easing of the tight money policy.


Mercopress – www.mercopress.com

Tags:

  • Show Comments (0)

Your email address will not be published. Required fields are marked *

comment *

  • name *

  • email *

  • website *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Ads

You May Also Like

Making a Difference

Sponsoring a youngster from a third-world country like Brazil promises to be an ongoing ...

Brazil’s Mining Giant CVRD Spending US$ 5 Bi. Blame It on the Chinese

Brazilian Mining company Vale do Rio Doce (CVRD) should invest 11.8 billion reais (US$ ...

Labneh, an Arab Cheese Conquering Brazil

A cheese with a particular taste, similar to ricotta, but slightly more tart, is ...

Cancelled Flights, No Government Bailout. Brazil’s Varig Is on Its Last Leg.

Brazilian aviation authorities blocked a deal that would have thrown a lifeline to Brazil’s ...

Brazil Suggests that Neighbors Break Patents to Fight Swine Flu

The leaders of Argentina and Brazil speaking during the Mercosur summit in Paraguay, suggested ...

Sweet Sixty

Starting in 1986, Ney Matogrosso decided to incorporate a sober side to his "scandalous" ...

Brazil Uses Trading Companies to Boost Exports

Brazil's Export and Investment Promotion Agency (Apex) launched a new project to encourage business ...

I Hate Those Hating Brazilians

One of the reasons given to explain why there are so many Brazilians in ...

Brazil Takes US to WTO over Orange Juice Surcharges

The Brazilian government has decided to ask the World Trade Organization (WTO) to analyze ...

Brazil: Pizzaiolo? You Should Mind Your Tongue, Mr. President!

Before he assumed the presidency, President Lula had dinner at my house more than ...