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

To: Steve Fancy who wrote (11270)	1/7/1999 12:27:00 AM
From: Steve Fancy	Respond to of 22640

Senate Hands Brazil's Government A 1st-Round Victory With Tax Vote Dow Jones Newswires January 7, 1999 BRASILIA -- The Brazilian Senate Wednesday approved by 61 votes to 19 the first reading of the extension and increase of the CPMF financial transactions tax for the next three years. The measure -- calculated to save the government 15 billion reals ($13.39 billion) in 1999 -- is considered a key measure of the government's fiscal stability plan and directly linked to the $41 billion international aid package for Brazil. The move was well received on the Sao Paulo Stock Exchange. The Bovespa Index surge 220 points, or 3.1%, to 7330 Wednesday. Senate Chairman Antonio Carlos Magalhaes announced after the vote that the second-round vote in the upper house will be held Jan. 19, after which the proposal will go to the Chamber of Deputies for another two voting rounds. The first-round government victory in the Senate is the first decision by Congress in the legislature's extraordinary session this January, a time when parliament is normally in recess for the Brazilian summer holidays. The constitutional amendment seeks to extend the CPMF tax -- which expires as a temporary levy Jan. 23 -- to the year 2001, simultaneously increasing its rate to 0.38% from the current 0.20% for the next 12 months, and then lowering it to 0.30% in 2000 and 2001. The CPMF, charged on all banking transactions, was first introduced two years ago and aims to raise funds to finance health services. Opposition legislators claim the revenue isn't used for its original purpose but rather for stopgap budget shortcomings as a whole. Because of Congress' failure to approve the amendment last year, the government announced a "mini-package" at the beginning of this month, including new tax raises to offset the estimated 5.4 billion reals of lost revenue due to the delay of the CPMF approval. New taxes in Brazil only become effective 90 days after their approval by Congress.

To: Steve Fancy who wrote (11270)	1/7/1999 12:28:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

World Bank Set to Approve $1 Billion Funding for Brazil Dow Jones Newswires January 7, 1999 WASHINGTON -- The executive board of the World Bank is likely to approve two loans worth a total of $1 billion for Brazil as part of the bank's contribution to the $41.5-billion rescue package unveiled last November. World Bank officials wouldn't comment on the details of the new loans, which are to finance a number of Brazilian social programs, but confirmed a decision on the loans is due Thursday. However, it is likely the loans will be issued under tougher terms than usual development-type loans, a change advocated by the finance ministers and central bankers of the Group of Seven leading industrialized nations in their joint statement of October 1998. The loans will be priced at an interest rate well above normal World Bank concessional rates and will have considerably shorter terms. Under the three-year financial rescue program arranged by the International Monetary Fund and supported by multilateral and bilateral lenders, the World Bank is to lend $4.5 billion to Brazil.