Estado de S. Paulo, 09/21/2013
Brazil’s primary budget surplus lost value as an indicator of the situation of the country’s public accounts, assessed economist Teresa Ter-Minassian, who believes the country is in danger of “loosing its fiscal compass” due to the accounting maneuvers used to try to keep the indicator within the official target.
Teresa, former director of fiscal affairs for the IMF, criticized the exclusion of expenses and the use of extraordinary revenues to increase the value of the indicator. “The budget surplus accounts for a universe that is becoming smaller and smaller,” she stated.
Read full article in Portuguese here.
“Brazil’s economy is recovering gradually from the slowdown that began in mid-2011,” the IMF Executive Board said in its annual assessment of the Brazilian economy on Wednesday.
It hailed the Brazilian government for beginning this year ”to focus on alleviating supply-side constraints (including infrastructure bottlenecks) and containing inflationary pressures by tightening monetary policy”.
IMF board stressed that “comprehensive efforts to boost productivity, competitiveness, and investment are critical for raising potential growth”.
Joe Leahy – Financial Times, 08/08/2013
Brazil has called for the IMF-backed rescue programmes for Greece and other southern eurozone countries to be reviewed to make them more economically sustainable.
The call from finance minister Guido Mantega came as he sought to explain Brazil’s stance on Greece’s rescue programme after its IMF representative, Paulo Nogueira Batista, abstained from a vote to approve the latest tranche of help for Athens.
In an interview with the Financial Times on Thursday, Mr Mantega said Brazil believed the International Monetary Fund-backed eurozone programmes needed to be overhauled to make them more realistic. “I think these programmes of fiscal adjustment created by Europe in general are excessive, they are very stringent,” he said.
David Bosco – Foreign Policy, 08/01/2013
Brazil’s representative at the International Monetary Fund, Paulo Nogueira Batista, made waves this week when he loudly criticized the latest round of international funding for Greece. Nogueira Batista reportedly abstained when the fund’s executive board approved the latest installment of the IMF loan package. Now the story gets more complicated. The Financial Times is reporting that Nogueira Batista wasn’t authorized to take the position he did (h/t Oliver Stuenkel):
“Brazil reversed its hardline stance on Greece’s bailout on Thursday, saying it had not authorised its representative to the International Monetary Fund to withhold support for the latest aid to Athens.
Guido Mantega, the country’s finance minister, said it was a “mistake” for Brazil’s representative, Paulo Nogueira Batista, to abstain on the €1.8bn tranche of aid. Mr Mantega said he fully supported the IMF’s efforts to supply financial aid to Greece.
“[Mr Nogueira Batista] did not consult the government, nor was he authorised by us to vote in this manner and the finance minister has ordered him to return to Brazil immediately to explain himself,” Brazil’s finance ministry said on Thursday.”
Alonso Soto – Reuters, 08/01/2013
Brazil called back its International Monetary Fund representative on Thursday after he voiced opposition to fresh loans for debt-ridden Greece, a stance that the South American country said was taken without its support.
Brazilian Finance Ministry Guido Mantega on Thursday phoned IMF managing director Christine Lagarde to clarify that its representative, Paulo Nogueira Batista, criticized additional aid for Greece without the authorization of the government.
Batista, who also represents 10 other nations at the Washington-based Fund, on Wednesday publicly criticized the IMF executive board’s recent decision to release 1.7 billion euros of rescue loans to Greece. Brazil abstained from the vote.
Anna Yukhananov & Harry Papachristou – Reuters, 07/31/2013
Eleven Latin American countries refused to back an IMF move this week to keep bankrolling Greece, citing risks of non-repayment, and the Fund itself said Athens might need faster debt relief from Europe.
The abstention by Latin American states from the IMF decision was revealed by their Brazilian representative in an unusual public statement on Wednesday, highlighting growing frustration in emerging nations with Fund policy to rescue debt-laden Europeans.
“Recent developments in Greece confirm some of our worst fears,” said Paulo Nogueira Batista, Brazil’s executive director at the IMF, who also represents 10 small nations in Central and South America and the Caribbean.
Randall Woods – Bloomberg Businessweek, 12/10/2012
International Monetary Fund Managing Director Christine Lagarde will likely outline the lender’s reversal of its decades-old opposition to capital controls on a five-day tour of Latin American this week, even as Brazil says the new position doesn’t go far enough.
In a Dec. 3 report, the IMF said targeted and temporary controls can be effective in preventing asset bubbles and currency rallies. Policy makers in Brazil, the largest economy in the region and the most aggressive in erecting such barriers, said the fund still shows a bias against controls, places too much emphasis on the benefits of capital flows and doesn’t hold rich nations accountable for fueling sudden liquidity surges.
Still, the IMF’s shift can give cover to countries that might consider enacting such controls, said Claudio Loser, a former Western Hemisphere director at the Washington-based fund.