Brazil to contribute funds to the IMF

By Marco Sibaja | April 11, 2009, Saturday |

Print Edition

Brazil will contribute up to US$4.8 billion to the International Monetary Fund as a member of its financial transaction plan, making the South American country a creditor to the lending agency, its government said on Thursday.

"The IMF has invited Brazil to be one of its creditor nations ... and I have accepted the invitation," Finance Minister Guido Mantega told reporters.

He said as a result of the invitation to join the financial transaction plan Brazil will make up to US$4.8 billion available to the IMF. The plan is the mechanism used by the agency to finance its loan operations.

Mantega said Brazil's role as a creditor would affect the makeup but not the volume of its estimated US$200-billion reserves because whatever contribution it makes will be used to purchase IMF Special Drawing Rights.

The invitation "shows that Brazil is seen as a country with a solid economy," he said. "It is also important because it will help make more credit available to emerging nations facing economic difficulties and thus help activate the world economy."

Mantega said the US$4.8 billion is not part of the funds it already pledged at the recent G20 meeting held in London. The amount of these funds has not been determined, he said.

According to Mantega, it is the first time since 1982 that Brazil joins the "club of IMF creditors."

In December 2005, Brazil paid off its full US$15.5 billion debt to the IMF.

Economy

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Brazil to contribute funds to the IMF

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