Brazil needs political coherence to fix economy says IMF

Brazil needs political coherence to come out of the vicious circle its economy has fallen into, including uncertainty and a lack of confidence, said Alejandro Werner Director of the Western Hemisphere Department of the International Monetary Fund, or IMF Wednesday.

According to IMF forecasts released during its annual meeting in Lima in October, Brazil will close 2015 with a contraction of 3 percent and 1 percent in 2016.

“In Brazil, the political crises and corruption scandals have generated an ‘impasse’ in which the issues of economic policy could not be processed and has delayed the expectations of recovery,” said Werner in an exclusive interview to EFE in the IMF headquarters in Washington.

For Werner, the package of measures launched by the Brazilian government in the first half of the year “had the potential of general corrections and the return of confidence.”

“However, extraeconomical, political factors, and (the state oil company Petrobras) corruption scandal, have intensified the crisis very significantly,” he added.

Brazil’s Finance Minister Joaquim Levy on his visit to Washington where he met Werner and the U.S. Secretary of Treasury Jack Lew, had said despite difficulties the Brazilian economy was resilient.

In the beginning of December President of the Chamber of Deputies of Brazil, Eduardo Cunha, a declared opponent of President Rousseff, authorized the start of proceedings for the president to be put on trial for impeachment, adding uncertainty to the political future of Brazil.

Rousseff may be prosecuted on the basis of some irregularities in the balance sheets of her government, registered in 2014 and which, according to the comptroller of state agencies, they have maintained this year.