Brazil on Friday received
commitments from big North American and European banks that they
would maintain current credit levels of $23 billion in Latin
America's largest economy.
Finance Minister Perdro Malan told a Paris news conference
that French and Belgian banks had joined British banks in
promising to uphold current commitments in Brazil's ailing
economy.
The deals, signed by Malan with the French and Belgian banks
in Paris and by Brazilian central bank president Arminio Fraga
in London follow similar agreements in Germany, other European
countries, the United States and Canada.
Malan and finance officials said the overall amount was $23
billion, the value of commitments in Brazil in February and
after the devaluation of the Brazil's real currency. Before the
devaluation, those exposure levels stood at $27 billion.
"This commitment guarantees Brazilian balance of payment
needs for 1999," Malan told a news conference after meetings
with French banks, Bank of France governor Jean-Claude Trichet
and French Finance Minister Dominique Strauss-Kahn.
French bank exposure accounts for roughly 10 percent of the
total $23 billion, Brazilian officials said.
Malan said no specific conditions had been imposed in any of
the countries.
"Of course, we expect banks with deeper interests in Brazil
not only to keep this minimum, but increase their commitment,"
he said.
Asked what would happen after August 31, Malan said: "Let's
cross that bridge when we come to it. Six months is a long
time."
Malan, in Paris for the annual meeting of the Inter- American
Development Bank, will be joined by Fraga over the weekend.
Formal IADB proceedings last from Monday to Wednesday and are
preceded by other gatherings over the weekend.
Earlier on Friday, Malan said Brazil would consider returning
to international capital markets after April, but that would
depend on market conditions. He declined to elaborate at the
news conference.
The French banks involved in the Paris deal are BNP, Credit Agricole Indosuez, Credit Lyonnais, Natexis, Paribas and Societe
Generale.
Belgian banks involved are KBC Bank and Generale
Bank.
Malan reiterated that Brazil, bolstered by securing a new
credit line from the International Monetary Fund earlier this
month, said the central bank reserved the right to use some of
its dollar resources for intervention to support the real. But
the bulk of those resources would be used for debt service
commitments, he added.
