MercoPress. South Atlantic News Agency

Lula announces funding for Rio Grande do Sul relief

“The federal government will not fail to meet the needs of the people of the region” of Rio Grande do Sul, Lula said

President Luiz Inácio Lula da Silva announced Tuesday that Brazil's federal government would grant R$ 1 billion (around US$ 202 million) in loans through the National Bank for Economic and Social Development (BNDES) to help recover the economy of Rio Grande do Sul, Agencia Brasil reported.

The funding will be allocated to the recovery of the southeastern State of Rio Grande do Sul from last week's extratropical cyclone which caused some 50 deaths and left nearly 8,000 people homeless.

Lula also said that 354,000 more workers with a formal contract would access the funds deposited in the Guarantee Fund for Length of Service (FGTS) accounts.

“We made the decision to grant the BNDES a loan of R$1 billion to help recover the economy of all the cities and, at the same time, to release R$600 million from the Guarantee Fund [for Length of Service] to help 354,000 workers who have a Guarantee Fund,” said the president in a video posted on social media after a meeting at the Alvorada Palace with ministers who are part of a working group set up to deal with the situation in the southern state.

“What I can guarantee to the people of Rio Grande do Sul, to the people of the region who were affected by the rain, is that the federal government will not fail to meet the needs of the people of the region, whether they are small and medium-sized businesses, residents or people who have lost their homes. We're going to take care of the people with a lot of affection because they can't suffer the way they're suffering,” he added.

Acting President Geraldo Alckmin visited the area last weekend while in charge of the Executive Branch due to Lula's trip to the G20 Summit in India and met with local mayors, ministers and Governor Eduardo Leite. The rains in Rio Grande do Sul, which began on Monday last week (4), have left almost 50 people dead and around 8,000 homeless.

Meanwhile, Brazil’s official inflation for the month of August was reported Tuesday by the IBGE statistics bureau to have reached 0.23%, up from 0.12% the previous month. The index is also higher than that recorded in August last year's -0.36%. Interannually, the increase stood at 4.61%, which is still within the inflation target set by the National Monetary Council (CMN) for this year—1.75 to 4.75%.

The main impact on inflation in August came from housing, which rose 1.11%, driven mainly by the 4.59% hike in electricity costs. Health and personal care (0.58%) and transportation (0.34%) also displayed significant impacts. On the other hand, food continued to fall (-0.85%) due to the decline in products such as potatoes (-12.92%), pinto beans (-8.27%), and tomatoes (-7.91%).

(Source: Agencia Brasil)