Press Release: Statement by IMF Managing Director Rodrigo de Rato at the Conclusion of his Visit to Brazil
August 23, 2007
Mr. Rodrigo de Rato, Managing Director of the International Monetary Fund (IMF), made the following statement today in Brasília:
"This is my third visit to Brazil as Managing Director, and I would like to thank the Brazilian authorities for their warm hospitality and the Brazilian Mercantile & Futures Exchange (BM&F) for inviting me to speak at their important conference on financial sector issues. I had very productive discussions with President Luiz Inácio Lula da Silva, Finance Minister Guido Mantega, and Central Bank President Henrique Meirelles about Brazil's recent economic performance and prospects, and a fruitful exchange of views on the ongoing reforms of the IMF. I also met with BM&F Chairman Manoel Felix Cintra Neto and key representatives of the private sector, and was very impressed by my visit to a school and a community education NGO, Cidade Escola Aprendiz, in São Paulo.
"I am impressed by the performance of the Brazilian economy whose growth rate has been increasing strongly. The government's prudent macroeconomic policies have helped raise growth, substantially lower inflation, and reduce poverty and inequality. Brazil has also taken advantage of the favorable external conditions of recent years to greatly broaden its export base, lower debt vulnerabilities, and increase international reserves, thereby helping bolster confidence in the economy, and cushion it from external shocks, including the recent turbulence in global financial markets.
"Brazil's economic outlook is also favorable. Continued sound macroeconomic policies, backed by the government's Growth Acceleration Program and other ongoing structural reforms, should entrench a virtuous circle of rising investment and growth. From the point of view of the IMF, raising investment in key infrastructure, with the participation of the private sector, is a priority for sustaining growth. Reducing the cost of bank intermediation is also a challenge for drawing in the necessary private investment. And, as in many emerging market countries, the efficiency of the regulatory system is very important. At the same time, the continued implementation of well-targeted social programs such as Bolsa Família will help the most vulnerable segments of society to continue to benefit from economic stability and increased growth.
"We also discussed governance reforms underway at the IMF. These reforms provide a historic opportunity for the Fund to enhance the voice of dynamic emerging market economies, including Brazil. Other initiatives include developing a new instrument for financing balance of payments difficulties and a new income model for the IMF. We look forward to working closely with the Brazilian authorities in the period ahead to help bring these important reforms to fruition."