Category: Brazil

The newly-appointed leadership of Brazil´s ruling Workers´ Party plans to summon Finance Minister Antonio Palocci and other party cabinet ministers to explain their performance amid mounting pressure to reverse economic policy. Senator Eduardo Suplicy said the move is an attempt to help, not control, implementation of state policies. Many Workers´ Party politicians want President Luiz Inacio Lula da Silva to reverse course on spending cuts he began imposing in February 2003.

Aracruz Celulose, Latin America’s biggest pulp exporter, saw its second-quarter profit more than triple to $207 million as the Brazilian real rose and debt costs tumbled. The real gained 19 percent in the second-quarter, helping Aracruz reduce the cost of paying its $1.76 billion of debt, which is 75 percent linked to the U.S. dollar. The company´s sales fell 9 percent to $342 million.

Brazil’s Federal Police detained deputy Joao Batista Ramos da Silva, from the opposition Liberal Front Party, and six other people found carrying $2.6 million in Brasilia´s airport. Silva told police the money was tithes collected at a Protestant church. The president of the Liberal Front Party, Jorge Bornhausen, called a meeting of the party’s executive committee, saying he considered the incident “very serious.”

will be joining us at Brazil – The Way Forward, The 3rd Brazil Investment Forum in Rio de Janeiro, 31 Aug – 1 Sep 2005. Join the dialogue at this annual high-level, invitation-only summit designed to advance discussion on the opportunities and challenges in Brazil, one of the world’s most exciting and dynamic economies. Apply for your invitation today at www.latinfinance.com/brazil

Abbott Laboratories agreed to lower the price of its AIDS drug Kaletra in Brazil after the government threatened to break the company’s patent and produce the medication itself. Brazil would have been the first country ever to break a patent on an AIDS drug. The country will be able to make the drug locally after Abbott’s patent expires in 2015 and the company transfers its technology. The government estimates that 215,000 Brazilians will need AIDS drugs by 2008.

Brazil’s consumer prices fell in June for the first time in almost two years, heightening speculation the central bank will start cutting interest rates as soon as next month. Consumer prices, as measured by the government’s IPCA index, fell 0.02 percent after rising 0.49 percent in May. The annual inflation rate tumbled to a seven-month low of 7.27 percent in June from 8.05 percent in May. Brazil´s central bank has raised its benchmark interest rate nine times since September.

Companhia Vale do Rio Doce, the world’s largest iron-ore exporter, became the first Brazilian company to get an investment-grade rating as Moody’s boosted its rating one level to Baa3. Moody’s said in a statement that Vale has a “solid position” in domestic and international iron ore markets and “continued strong cash flow generation capability.” Vale´s rating is four levels above the Brazilian government´s rating of B1.

Brazil’s ruling Workers’ Party President Jose Genoino stepped down from his post in a bid to help the party, dogged by allegations of corruption, restore its credibility. The party’s executive board didn’t immediately name a replacement. Genoino is the third senior official in President Luiz Inacio Lula da Silva’s party to resign as lawmakers investigate allegations the party traded jobs and money for votes. Genoino, who helped Lula form the Workers´Party in 1980, denies he committed any wrongdoing.

will be joining us at Brazil – The Way Forward, The 3rd Brazil Investment Forum in Rio de Janeiro, 31 Aug – 1 Sep 2005. Join the dialogue at this annual high-level, invitation-only summit designed to advance discussion on the opportunities and challenges in Brazil, one of the world’s most exciting and dynamic economies. Apply for your invitation today at www.latinfinance.com/brazil

Brazil’s industrial output growth slowed in May to 5.5 percent year-on-year as rising interest rates curbed demand for vehicles and other durable goods. Industrial output expanded 6.3 percent in April. The new figures are adding to speculation the central bank will begin cutting its benchmark interest rate, which is currently at a 20-month high of 19.75 percent.