MercoPress. South Atlantic News Agency

IMF praises Brazilian economy performance

The head of the International Monetary Fund mission in Brazil said he was impressed with the performance of the Brazilian economy during 2004 which helped to significantly reduce its financial vulnerability.

"Overall, we are impressed with the sustained strong performance of the Brazilian economy, with a robust growth and a strong external presence which substantially reduced vulnerability", said Charles Collyns following a meeting in Brasilia with Treasury Secretary Joaquim Levy.

Mr. Collyns, Deputy Director of the IMF Western Hemisphere Department is currently in Brazil for the last quarterly review of the stand by agreement between IMF and Brazil.

The mission is scheduled to remain in Brazil the whole of next week and will be holding meetings with officials from the Central Bank, Finance Ministry and other related offices.

The IMF-Brazil agreement expires next March and the main target a primary surplus equivalent to 4,25% of GDP was comfortably achieved. Actually the Brazilian government decided mid year unilaterally to take it to 4,5% and ended 2004 with a 4,6% GDP primary surplus.

Brazil has not appealed to the IMF 40 billion US dollars stand by credit agreement but has not discarded a renewal to protect itself in the event of serious external financial crisis such as those of the nineties.

Meantime in Davos, Switzerland Brazilian president Lula da Silva addressing the World Economic Forum revealed that the Brazilian economy expanded 5,3% in 2004 and forecasted that the country would export 108 plus billion US dollars in 2005.

The Brazilian Bank also released a report indicating that the liquid debt/GDP ratio dropped from 57,2% at the end of 2003 to 51,8% December 2004, the best ratio since 1995.