BRAZIL SAYS DEBT CRISIS IS WORLD PROBLEM
Brazilian Finance Minister
Dilson Funaro said his country's foreign debt crisis could only
be solved by changes in the international financial system.
    Speaking to a business conference he said "It is not Brazil
that has to make adjustments with the IMF (International
Monetary Fund). It is the international financial community
that is taking away resources from the developing countries."
    "The crisis is not in Brazil, a country that has had the
third biggest trade surplus ...In the past two years Brazil had
remitted 24 billion dlrs in debt servicing and received only
two billion in fresh funds," he added.
    Funaro said that during his recent trip to the U.S., Europe
and Japan to explain Brazil's decision last month to suspend
interest payments on 68 billion dlrs of commercial debt, he
stressed the country's commitment to growth.
    "We need to and will make the effort (to solve the debt
problem) but we cannot make an effort that means we stop
growing," he said, adding that political and not purely
commercial solutions were needed to the debt crisis.
    Brazil, whose 108 billion dlr foreign debt is the largest
in the developing world, has been under pressure from official
and private creditors to work out an economic adjustment
program with the IMF to combat rocketing inflation and foreign
payments problems.
    President Jose Sarney's government has repeatedly refused
to approach the Fund, arguing that an IMF programme would lead
to recession. Funaro said that in his talks with creditors he
had tried to restore credibility in the country in the hope of
finding a lasting solution to the debt problem.
    "We are negotiating so that the debt question should not be
one of continuous crisis."
    To sustain internal growth Brazil would have to import more
machinery and equipment this year and export fewer raw
materials. The country was thus targetting a fall in this
year's trade surplus to 8.0 billion dlrs from 1986's 9.5
billion.
    Domestically, Funaro said economies had led to a reduction
in the public sector deficit to 2.7 pct of gross domestic
product in 1986, the lowest for many years and that this should
fall to 1.5 pct this year.
 REUTER
