Brazil Adamant on IMF Policing of Its Economy

Brazil is still opposed to substantive involvement by the International Monetary Fund in policing its economy, Fernao Bracher, president of Brazil’s central bank, said Friday.

Bracher made the statement after signing an interim $31-billion financing package with a group of international banks. The IMF provides funds to member countries under certain conditions of need and policy commitments.

Because Brazil has spurned either a loan agreement or an economic monitoring arrangement with the IMF, banks have refused to negotiate a multiyear debt rescheduling, and the group of government creditors known as the Paris Club has balked at refinancing Brazil’s official debts.

Defends Stance

Although Bracher was careful to leave open the possibility of some role for the IMF, he later defended to a small group of reporters Brazil’s stance by citing a list of economic achievements made without the IMF’s involvement.

Inflation has been reduced from 15% a month to 0.87% in the past four months, official public debt has been reduced by 9.5% this year, the trade surplus has exceeded $1 billion a month, and 1986 growth will top the historic average of 7% of its gross national product, Bracher said.

He said Brazil’s creditors must choose whether they want to jeapardize these gains by insisting on a role for the fund just for the sake of appearances.

“Does the international community want the substance or the form?” Bracher asked.