Brazil to send fiscal plan to Congress by Nov 15
Reuters, Tuesday, September 08, 1998 at 12:18
BRASILIA, Sept 8 (Reuters) - Brazil's government plans to
send a Fiscal Adjustment Program aimed at cutting the fiscal
deficit between 1999 and 2001 to Congress by November 15,
Finance Minister Pedro Malan said Tuesday.
Malan said the government hopes to reduce the country's
dependence on foreign savings and raise domestic savings in
order to reduce the fiscal deficit.
"We are not only assuming firm commitments but giving the
government the legal means so that these targets can be met,"
said Malan.
More immediately, the government also said it is going to
cut the federal budgets for 1998 and 1999 in a bid to reduce
the country's public sector budget deficit, seen as one of
Brazil's most pressing economic problems now.
Spending on social programs and infrastructure in 1998 will
be cut by four billion reais to achieve a primary surplus --
not including debt costs -- of five billion reais, the ministry
said in a statement.
Malan said that the government also hopes to substitute an
increase in domestic savings for some of Brazil's hefty foreign
savings.
"We have to reduce the relative weight of foreign savings
of total Brazilian savings and increase the weight of domestic
savings," Malan said.
Brazil relies heavily on flows of foreign dollars to help
cover its budget deficit, currently estimated at 7 percent of
gross domestic product in annual terms.
The Fiscal Adjustment Program will contain measures aimed
at "stabilizing" the relationship between the fiscal deficit
and GDP, Malan said.
Copyright 1998, Reuters News Service |
