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“Time to harvest”, announces Lula da Silva

Friday, December 24th 2004 - 20:00 UTC
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Two years after taking office Brazilian president Luiz Inacio Lula da Silva can celebrate 2004 as a year of achievements both political and economic, however poverty and equality remain the soft spots of his administration.

Lula da Silva in his speeches admits social shortcomings but promises changes, "I can see ahead a clear sky, calm waters", and forecasts that the "time to harvest" is arriving.

Politically the originally Socialist Brazilian president was able to expand his party's control following the municipal elections in spite of loosing clue cities as Sao Paulo and Porto Alegre. Similarly he managed to convince Congress to approve most of the legislation he promoted even with recurrent divisions in the ruling coalition.

Economically he diminished the country's foreign vulnerability, set the economy back on track and expanding, and has a 60% approval which gives him a formidable base to dispute the 2006 re-election.

In foreign affairs Mr. Lula da Silva proved his leadership promoting a world fund to combat hunger, launching South American integration and making Brazil a serious candidate to hold a permanent seat in a future reformed UN Security Council.

But the economy proved the most impressive: GDP is forecasted to expand over 5%; trade surplus will reach a record 32 billion US dollars and the Brazilian currency which at the beginning of his term reached almost 4 Reales to the US dollar, stabilized at 2,75 to the US dollar.

Unemployment dropped from 13% last April to 10,5% currently and the foreign debt/GDP ratio contracted from 60% to 54%.

Another field of advance was the recent approval by Congress of a new infrastructure financing system involving the private sector, Public-Private-Associations.

This will enable the Brazilian government to lease construction in vital areas such as roads, bridges, ports, energy which will help cover the capital investment deficit.

The system to attract private investors basically ensures that the projects are profitable and that they will have a priority regarding federal budget resources.

"PPP is an important step which opens association possibilities for public and private sectors, addressing the infrastructure deficit that could endanger the growth cycle started this year", said Armando Monteiro Neto, president of the Brazilian Confederation of Industry praising the initiative.

Categories: Mercosur.

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