Brazil’s President of the Central Bank (BC), Henrique Meirelles, declared that lowering the Brazil risk index (which measures foreign investors’ confidence) will lead the country to a process of investment and production and permit a drop in interest rates.
“The correct and persistent application of sound economic policies will permit a substantial decline in the Brazil risk index, allowing in due time a sustained and responsible reduction of the interest rate, as everyone desires,” Meirelles said.
The Central Bank chief recalled that the government’s main concern in its handling of economic policy is the social question.
According to Meirelles, the investment process is incomplete without a strong social component.
After all, he said, the final goal of any economic policy deserving of the name is a significant improvement in the living conditions of the population.
“Lula’s Administration is demonstrating, in practice, that there cannot be a contradiction between social action and responsible macroeconomic administration,” Meirelles added.
In the first half of this year, the Brazilian economy produced US$ 286.5 billion (816.8 billion reais), US$ 150.5 (429.1 billion reais) in the second quarter and US$ 136 billion (387.7 billion reais) in the first.
These figures, released September 30 by the Brazilian Institute of Geography and Statistics (IBGE), confirm the 4.2% increase in the Gross Domestic Product (GDP), the sum of wealth produced in the country, in the first half of 2004, compared with the same period last year.
This represents the best result since the first semester of 2000.
Translator: David Silberstein
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