Brazilian president Dilma Rousseff said the financial crisis in the Untied States which is contaminating the rest of the world is more ‘political’ than economic and it’s not only a matter of money, but also and mainly of ‘strong decisions’
The problem was born in 2008 when the US government went to the rescue of the banks and converted “private debt into public debt”, which at the time was inevitable and helped prevent a major catastrophe.
However now “there is a political objection in the US precisely when there is a need for greater fiscal expenditure, when the US needs a fiscal imitative and not only monetary”.
“The greatest difficulty facing the US currently is the lack of political decision in the sense of sending a strong message of stimuli to investments” added President Rousseff.
“The problem is not money”, insisted Rousseff who added that ‘depending on circumstances’ she could very well address the issue with her US peer Barrack Obama during the coming meeting next week in New York in the framework of the UN General Assembly.
Rousseff added that there is no international solution for this type of problems, not even for the Euro zone, since “it’s up to them to define conditions and to speed up the rescue package”.
As to the possible impact of the global crisis on Brazil, Rousseff said the government would be doing a major effort and achieve a 4% expansion this year.
The Brazilian economy expanded 3.6% in the first quarter of the year, and 0.8% in the second quarter. Rousseff admitted the third quarter should be even slower, but in the last quarter of the year, “there will be a strong resurgence that should allow us to end the year with just over 4% annual growth”.