Brazil's Lula Favors Foreign Capital Only
If Jobs Created
Dow Jones Newswires
SAO PAULO (AP)--Brazil's leftist presidential candidate Luis Inacio Lula
da Silva said Thursday he supports the entrance of foreign capital, but only
if it boosts employment levels.
"We have no problem with foreign capital, as long as it is invested in
productive ventures," Lula said at a meeting with foreign correspondents.
He said he would welcome foreign investments in industry, agriculture and
tourism.
"The best way to attract foreign capital is to offer opportunities to invest in
projects that create jobs and improve income distribution, thus
guaranteeing social stability," the Workers' Party candidate added.
Lula, the principal challenger in President Fernando Henrique Cardoso's
bid for reelection on Oct. 4, said that job creation would be his top
priority if elected.
Officially, unemployment in Brazil is close to 8%, its highest level in 15
years. Independent research centers, however, say that figure is grossly
underestimated. Some estimates put unemployment in the greater Sao
Paulo area alone at around 20%.
"Unemployment cannot be successfully tackled unless we get the economy
growing again," Lula said. "And to expand the economy you have to get
rid of high interest rates and deal with the foreign exchange that favors
imports and hurts exports."
Although he did not go as far as saying he would devalue Brazil's currency,
the real, he did say that no matter who wins the election, the country's
foreign exchange policy "will be a problem that will have to be dealt with."
Lula said he does have a problem with foreign capital being invested in the
country's stock exchanges.
"We can no longer allow speculative capital to dictate investment
standards," the Workers' Party candidate said. "It neither creates wealth
nor favors income distribution. It must be controlled." He gave no further
details.
In the first seven months of the year, foreign net investment on the Sao
Paulo Stock Exchange - South America's largest - totaled 1.22 billion
reals ($1=1.17 reals).
Lula also criticized Brazil's privatization program, saying it has "not created
one single job. It has only created more unemployment."
He said he favored a complete auditing of some of the companies
privatized "because I think fraud may have been committed in some of the
privatizations." He would not say which ones.
Asked how he would respond to fears that a leftist government would
wreak havoc on the economy, Lula said: "Let me first point out that none
of the Asian countries where investors recently suffered major setbacks is
governed by a leftist. They are all ruled by conservative political forces."
"It is not the ideological profile of the government that will cause capital
flight, but investor anxiety," he added.
In early June, some opinion polls showed Lula running neck-and-neck
with Cardoso. But recent polls indicate that Cardoso, who is credited with
bringing economic stability to Brazil, now holds a comfortable lead. |
