MercoPress. South Atlantic News Agency

Brazilian economic model is changing, “lower interest rates and a weaker Real”

Disney trips are over, discover Brazil, the model is changing, announced the economy minister Paulo Guedes

Brazilian Economy minister Paulo Guedes said that the economic model has changed and no long is made up of high interest rates and a strong Real. His comments follow concerns that the exchange rate of the Real against the US dollar has been increasing sustainedly for the last few days.

In effect this week it reached 4.35 Reais to the US dollar which obviously makes imports and travelling overseas dearer.

Guedes speaking at a business conference said Brazilians should travel more in the country and enjoy all of Brazil's tourist facilities.

“It's not good business to have the dollar at 1,80 Reais. This meant everybody travelled to Disneyworld, even domestic service was travelling to Disney... I strongly recommend discover the Iguazú waterfalls, visit the northeast coast, it's full of beautiful beaches..., visit the gauchos prairies in the south...”

Guedes said that Brazil with an overvalued Real had been involved in a serious de-industrialization process, trapping exports and giving more space to imports.

“But that is over, the model is changing. Interest rates are much lower, there is more investment, more consumption, and with the exchange rate a bit higher, which is good for everybody, because it means more exports, more substitution of imports”.

The minister said that even in the labor intensive sectors such as the tourism industry, “ ”we're going to make sure all Brazilians learn to discover their country and its beautiful opportunities”