SAO PAULO, Aug 20 (Reuters) – Brazil’s Finance Minister Dario Durigan said on Thursday that, if President Luiz Inacio Lula da Silva’s administration wins another term in the October election, the country will maintain its fiscal framework through spending controls and revenue recovery.
“Under this administration, we undertook a fiscal effort amounting to 2% of GDP. We are prepared to make an effort of the same magnitude,” Durigan said in an interview with local radio CBN.
Durigan noted that in discussions with Congress, adjustments have been made to cut mandatory spending by around 10 billion reais ($1.9 billion) in 2027.
“We must continue this good work of institutional dialogue—cutting spending and broadening the revenue base in a way that is fair to the population — so that we can achieve a positive result as early as next year. And that is exactly what we are going to do.”
He argued that the “issue of interest rates” must be addressed to tackle inequality, adding that lower borrowing costs could also help reverse the trajectory of public debt.
Brazil’s central bank earlier this month cut its benchmark interest rate by 25 basis points for a fourth consecutive meeting, taking it to 14.00%, but leaving its next moves open.
The minister said meetings with economists from a range of backgrounds have been valuable in helping him understand their concerns ahead of the election.
($1 = 5.1802 reais)
(Reporting by Isabel Teles and Eduardo Simoes; Editing by Toby Chopra and David Holmes)
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