In Brazil, President Joao Figueiredo has announced Friday new economic guidelines aimed at curbing soaring inflation.
In Brazil, President Joao Figueiredo has announced Friday new economic guidelines aimed at curbing soaring inflation. The Brazilian currency, the cruzeiro has been devalued by thirty percent and a system of export tax instituted.
Sao Paulo's financial district was quiet on Friday (7 December) as bankers waited for the presidential announcement. According to the government the Brazilian economy is at a crucial stage with inflation running at about seventy percent. They also report the foreign debt is approaching fifty billion dollars and the trade deficit is expected to reach two and a half billion dollars this year.
President Joao Figueiredo's financial package follows growing social tension over inflation and a marked increase in crime. His message to the nation was that "uncontrolled inflation is the insidious enemy". He said there were several major causes of Brazil's inflation. Among them were crop failures which triggered a rise in grain prices and resulted in the government having to subsidise wheat at the cost of millions of dollars.
Friday's new economic measures come just two weeks after a rise of almost sixty percent in the price of petrol. Brazil imports more than eighty percent of its oil and official sources said the government's decision to increase petrol prices was partly an attempt to reduce consumption.
Security surrounding the President was tight, as news of the economic reforms filtered through to the population.