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Strategies & Market Trends : Telebras (TBH) & Brazil -- Ignore unavailable to you. Want to Upgrade?

To: Steve Fancy who wrote (9008)	10/14/1998 11:12:00 PM
From: Steve Fancy	Respond to of 22640

After A Year Of Haggling, IMF To Get $18 Bln From U.S. October 14, 1998 By MARK H. ANDERSON and JENNIFER CORBETT DOOREN Dow Jones Newswires WASHINGTON -- It only took a year, but Congress has finally agreed to supply the International Monetary Fund with $18 billion in U.S. funding. "I think I can say, 'yes,"' Senate Majority Leader Trent Lott, R-Miss., said, when asked late Wednesday if the IMF funding was included in a budget pact just reached between Republicans and the White House. The IMF funds will be tied to a series of reforms sought by House Republicans, who have been critical of the 182-country organization in the wake of the Asian and Russian financial crisis. The measure will be included in the broader $500 billion spending bill that includes the IMF language. The Clinton administration first sought part of the funds last fall to shore up the IMF's coffers shortly after the Asian financial crisis broke loose. Since then, Russia has joined the fray of economic casualties and the world's economic woes are spreading to Latin America, where Brazil is likely to receive the next multi-billion bailout from the 182-country organization. White House officials and congressional leaders hovered over a deal on the IMF spending for days, as those leaders struggled with other U.S. domestic spending issues. While most of the terms of the deal were set days ago, the package was open for amendment up until the broader spending pact was sealed. Deputy Treasury Secretary Lawrence Summers, speaking Wednesday on C-Span, said the package "reflect's everybody's preferences." He added the funding approval "enables us to strengthen global economies, which in turn strengthens our economy." The conservative Republicans, led by House Majority Leader Richard Armey, R-Texas, ignored senators' pleas for urgency on the funding, twice overlooking Senate approval of the $18 billion request tied to more moderate reforms. "We must have these reforms or there cannot be any increase in funding," Armey said. Republican persistence paid off. The IMF funds come with a stiff price. The reform package, according to a recent draft, would require the IMF to alter its lending practices. Not only will loan maturities be reduced to between 1 and 2 1/2 years, but those loans must also be made at 3% above LIBOR. The IMF board must also disclose more information about its meetings as well as information regarding lending practices. The Treasury Department, through a new commission that includes members of Congress, must confirm that other IMF member countries support the reforms and that the organization is following through with them. The plan also retains language from earlier Senate action on the IMF funding, barring IMF funding to South Korea if the government plans to use any of the money to subsidize local industries, including semiconductor, automotive, shipbuilding, steel and textile companies. South Korea has already received a large bailout package tied to the Asian crisis. As the IMF talks came to a head last last week, Treasury officials signaled to Republicans that they were willing to accept the broader reforms and were working with other key countries, such as those in the G-7, to vet the reform requirements. This week, jockeying over the package has focuses on the minutia of the IMF package. After Rubin met with top GOP leaders Tuesday, officials on both sides of the issue said the final pact was subject to only a handful of words. "There's a general expectation that we need full funding for the IMF," Treasury Secretary Robert Rubin said, adding that funding would include "real reforms." Congressional scrutiny of the IMF isn't likely to end with this agreement. Some Republicans in the House are characterizing the IMF package as a first step in attempting to alter how the organization does business. "We have begun a very serious discussion of this institution," said Rep. Jim Saxton, R-N.J., promising that he, Armey and others will continue to push for changes at the IMF when Congress returns next year. -By Jennifer Corbett Dooren and Mark H. Anderson;202-862-9230

To: Steve Fancy who wrote (9008)	10/14/1998 11:18:00 PM
From: Steve Fancy	Respond to of 22640

Dell (NASDAQ:DELL) confirms new factory for Brazil Reuters, Wednesday, October 14, 1998 at 20:17 BRASILIA, Oct 14 (Reuters) - U.S. computer maker Dell Computer Corp. has confirmed its plan to invest 128 million reais ($108.5 million) in a new factory in Brazil, the Brazilian Industry and Commerce Ministry said Wednesday. Dell planned to build a desktop computer plant in Porto Alegre, capital of southernmost Rio Grande do Sul state, the ministry said in a statement. "The project will create 250 direct jobs and production should begin in April 1999," the statement said. In August, Dell announced that, pending Brazilian government approval, it planned to manufacture desktop computer systems for customers in the Mercosur customs union, which includes Brazil, Argentina, Uruguay and Paraguay. Dell also said in August it planned to market a complete line of desktop, notebook, workstation and server systems, and offer service and technical support to the Brazilian market through its direct-sale model. william.schomberg@reuters.com)) Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (9008)	10/14/1998 11:21:00 PM
From: Steve Fancy	Respond to of 22640

Fiscal package to be announced after the run-off São Paulo, 14 - The expected fiscal adjustment package should only be announced after the states run-off elections. According to sources close to President Fernando Henrique Cardoso, he could not release the measures unless he was "crazy". One of the main allies to Cardoso believes that not even the candidates supported by the President, including those of ruling party PSDB, would approve the fiscal measures in the face of the pressure suffered by their rivals. The issue should be thoroughly exploited by the opposition. "It is very unlikely that Brazil manage to resolve its fiscal troubles by raising taxes," PT president left-wing leader, José Dirceu, criticized, in a reference to the planned Temporary Tax on Financial Transactions (CPMF) hike to 0.30% from the current 0.20%. (O Estado de S. Paulo/ Jornal da Tarde)

To: Steve Fancy who wrote (9008)	10/14/1998 11:22:00 PM
From: Steve Fancy	Respond to of 22640

Welfare reform: Congress to resume voting next November 4 Brasília, 14 - Brazil's Communist party federal deputy, Sérgio Miranda, from Minas Gerais state, confirmed today that Congress will resume Welfare reform voting only on next November 4. The decision was made today by a group of leaders in the Chamber of Deputies. (By Nelson Breve).

To: Steve Fancy who wrote (9008)	10/14/1998 11:23:00 PM
From: Steve Fancy	Respond to of 22640

Fiscal package postponement rumors push local stocks down Domestic equity markets closed out the day lower, once again on thin volume. Not even the fact that the São Paulo Stock Exchange index's futures (Ibovespa futuro) expired today, which usually stimulates trading, helped traders overcome the effects of rumors that the government will only announce its fiscal package after the run-off state elections on October 25. The government later denied such rumors, but the initial frustration led traders to remain cautious and not assume any risks. In face of this scenario, not even the Dow's recuperation today brought any relief to local markets. The São Paulo stock exchange index (Ibovespa) finished lower by 2.61% at 6,445 points (Ibovespa/US$ finished down 2.67% at 1,972 points). Trading volume totaled US$354.077m, with 27.491 billion shares having changed hands. The Rio de Janeiro Stock Exchange Index (IBV-RJ) closed lower by 1.80% at 22,327 points (IBV/US$ closed down 1.85% at 6,831 points). Among the blue chips, Telebrás Receipts/US$ ended down 3.49%. Eletrobrás finished lower by 2.85%. Petrobras PN/US$ finished down 0.81%. Usiminas finished lower by 6.98%. CSN ended down 1.58%. At the Futures and Commodities Exchange (BM&F), dollar futures contracts for November finished stable at R$1.19290. December contracts finished the day up 0.04% at R$1.2055. The floating dollar rose 0.08% to R$1.1909 offering a premium of 0.18%. The black market dollar ended the day down 0.76% at R$1.300, offering a premium of 9.35%. The commercial dollar Ptax ended at R$ 1.1875/ R$ 1.1874 from R$ 1.1867/ R$ 1.1859 last Friday. The Central Bank announced today it conducted its third inner-band adjustment of the month of 0.085%, allowing the real to range between R$ 1.1790 (floor) and R$ 1.1900 (ceiling) The commercial dollar Ptax ended at R$ 1.1884/ R$ 1.1882 from R$ 1.1875/ R$ 1.1874 last Monday.