Summers-Brazil hit by contagion, has made progress
Reuters, Tuesday, September 22, 1998 at 21:25
WASHINGTON, Sept 22 (Reuters) - U.S. Deputy Treasury
Secretary Lawrence Summers said on Tuesday that Brazil had made
progress on its economy and he said contagion was behind its
latest financial problems.
"Brazil has made enormous progress in the last few years
and they have been hit by contagion, not really driven by
things in its own economy," he told CNN's Moneyline. "Certainly
that's the situation that the IMF and the G7 are watching very
closely and in touch, we want to see the right response in
terms of Brazil's charting its own economic course forward."
Summers did not respond directly to CNN's question, which
asked him to comment on what it described as an IMF report that
"the IMF has worked out with Brazil a (loan) facility,
estimates -- at least reports of estimates -- run anywhere from
$15 to $25 billion."
International monetary sources said on Tuesday that Brazil,
Latin America's largest economy, had not asked for financial
help from the International Monetary Fund, although the two
sides were in discussion on policy issues.
Financial markets have however speculated about the release
of a multi-billion rescue package, including money from the
IMF.
Many analysts in Washington have said that Brazil is
unlikely to request IMF cash before its Oct. 4 presidential
election because to do so would be an admission of defeat for
President Fernando Henrique Cardoso, who is the firm candidate
to win.
A request for IMF cash would mean accelerating already
announced programs to curb spending and rein in the budget
deficit, and that would go down poorly before an election.
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Copyright 1998, Reuters News Service |
