Brazil President: new IMF deal not needed
President Luiz Inacio Lula da Silva said Thursday that Brazil doesn't need a new agreement with the International Monetary Fund (news - web sites) to protect its economy.
Speaking at a breakfast with reporters, Silva said his economic team would make the final decision about renewing the loan agreement in March. But he said Brazil's economy today was robust.
"Brazil is in such a comfortable position it doesn't need an accord with the IMF (news - web sites)," Silva said. "Today we don't need a loan. But there was a time that we almost had to beg for a loan, so we also don't want to push the idea that we won't need it, because we could."
Silva said Brazil has not drawn funds from its $14 billion loan agreement with the IMF, which expires in March.He also said his government would let the Brazilian real fluctuate freely against the U.S. dollar and find its own natural exchange rate.
Last week, the dollar fell to 2.69 reals, its lowest point since June 2002. The dollar's slide has left many here worried that it will hurt Brazilian exports, because they will cost more in dollars. Brazil is expected to end the year with a record trade surplus of $33 billion.
Virtually stagnant last year, Brazil's economy is expected to grow 4.5 percent in 2004. The country's stock market has also surged in recent months.
(From YahooNews, December, 27, 2004)