Brazil Lula Blames Global Instability on US’s Casino Mentality

Casino in Las Vegas, US The Brazilian economy expanded 0.8% in the second quarter over the first quarter reported Wednesday, September 12, the IBGE (Brazilian Institute of Geography and Statistics). And there was a 5.4% increase over the same period a year ago.

However market analysts were expecting a 1.2% expansion over the first quarter and 5.8% over the second quarter of 2006.

But the Economic Research Center from the powerful São Paulo State Federation of Industries, FIESP, said that the second quarter GDP figures coincide with the level of activity of the manufacturing industry, which was released last week.

"The GDP statistics came as no surprise, it was rather a confirmation of the good performance the Brazilian economy is undergoing", said Paulo Francini, head of the FIESP Research Center.

Francini estimated that South America's largest economy would end 2007 with a 5% expansion which is in line with the activity of the manufacturing industry.

The Brazilian economy so far has proven to be resilient to the US housing crisis and global credit re-pricing and has been recommended by investment banks as a safe and profitable haven for investors.

Brazilian president Luiz Inácio Lula da Silva currently on a European tour said that Brazil can sail through current turbulences without major setbacks because "our fundamentals have never been so strong", and "international reserves stand at US$ 160 billion."

Nevertheless Lula blamed much of the current global instability to US financial policy "which allowed investment funds, hedge funds to purchase high risk papers and resell them acting as if they were in a casino. And they lost, and we're not prepared to tolerate that developing countries should pick up the bill of a gamble in which we did not participate."

Lula insisted it is the US government responsibility to address the sub prime mortgage crisis, "because they helped the creation and growth of those financial instruments and unregulated identities that have led to the current situation" and called on the Central banks of the industrialized world to act accordingly ensuring the crisis does not spill to the developing world.

Mercopress

Tags:

You May Also Like

Brazil’s Most Wanted Drug Lord Tells in Jail Half of His Fortune Was Spent Bribing Police

As Brazilian authorities work to take back control of favelas (slums) from the hands ...

Brazil Gets Ready for War Rearranging and Funding Its Defense Network

The Brazilian government announced this week the creation of an ambitious defense structure, to ...

Another Government Party Official Steps Down in Brazil Due to Corruption Charges

The secretary general of the PT, SÀ­lvio Pereira, has requested a leave of absence. ...

Brazil Brings Heavyweights to Davos to Lure Investors

On January 29, around 100 European, American, and Asian investors will attend a meeting ...

Brazil and Argentina Differences Are Narrowing Says Argentinean Minister

Economy ministers from Brazil and Argentina meeting in Buenos Aires said that they are ...

Brazil’s Industrial Activity Falls 15% in First Quarter

Brazil's industrial production posted slight growth from February to March, registering growth of 0.7%. ...

Slavery and Freedom

By Brazzil Magazine Most African Brazilians today are poor and most of the poor ...

World Bank Funds Brazilian Survey on Family Grant Program

Brazil is about to begin its largest ever impact survey of a government program ...

Oil and Science in Brazil-Tunisia Agenda

Tunisia and Brazil may establish scientific cooperation agreements in the areas of information technology, ...

Brazil Wants Its Share of Indian Riches

The Brazilian government wants mining to cease on Indian lands. For this purpose, it ...