Brazil announced its intention to make an early repayment of its entire outstanding obligations to the International Monetary Fund (IMF) amounting to SDR 10.79 billion (about US$ 15.46 billion).

SDR, or Special Drawing Right is the artificial currency created by the IMF, which is based upon the currency of several countries.

The outstanding obligations of Brazil had been contracted under the Stand-By Arrangement that was approved by the Executive Board on September 6, 2002 and extended and augmented on December 12, 2003.

Mr. Rodrigo de Rato, the Managing Director of the IMF, said, "I very much welcome Brazil's decision to repay its outstanding obligations to the Fund. This decision reflects the growing strength of Brazil's external position, especially continuing substantial trade and current account surpluses and strong capital inflows that have greatly boosted reserves and reduced external debt.

"More fundamentally, the excellent track-record of policy management by the Brazilian authorities has provided the basis for the consolidation of market confidence, the sustained improvement of macroeconomic performance, and an improvement in the profile of domestic as well as external debt.

"The Fund looks forward to continuing a close and constructive relationship with the Brazilian authorities, including in key areas such as public investment," de Rato added.

Total drawings by Brazil under the Stand-By Arrangement were equivalent to SDR 17.20 billion (about US$ 24.65 billion), out of a total of SDR 27.4 billion (about US$ 39.23 billion) that were made available. Under the original schedule, the final repayment of outstanding loans from the IMF would have taken place in 2007.

On July 22, 2005, the Brazilian authorities repaid early the outstanding Supplemental Reserve Facility (SRF) obligations to the IMF amounting to SDR 3.42 billion (about US$ 4.91 billion).

The Executive Board met on December 7, 2005 to consider Brazil's performance since the end of its program, and a summary of that discussion will be issued shortly. The next Article IV consultation is expected to take place in March 2006.

IMF - www.imf.org

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written by Guest, December 23, 2005

Lula has been in government for just 3 years and has already suceeded to reinsert Brazil in the way of development. Inflaction is controled in a 5% year rate; employment rising up regularly; foreign debt beeing honored in advance - it corresponds now to 1.4 times the country's GDP, 3 years ago it was as high as 4.4 times the GDP!; foreign trade performing excelent results - in 2005 hit an astonishing US$44 billion surplus; U$57 billion value international reserves - the highest ever registered; a highly responsible fiscal politic recording an annual surplus of 5.28%, allowing the Government to honor the domestic debt. For all these reasons the risk for investment in Brazil is sharply falling down and now it's about 300 rate.
Lula means development and responsability. That's the reason Lula will be re-elected president in 2006!!!!

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