Mantega Says Using Brazil Wealth Fund to Cover Budget Legitimate

Brazil Portal

Mario Sergio Lima – Bloomberg, 9/23/2014

Brazilian Finance Minister Guido Mantega defended today the use of the country’s sovereign fund to help meet fiscal targets in a year when Latin America’s biggest economy had its debt rating downgraded.

Brazil announced it will withdraw 3.5 billion reais ($1.45 billion) from the sovereign fund to cover spending. The primary surplus, which excludes interest payments, was 1.22 percent of gross domestic product in the year through July, compared with the 1.9 percent target.

“The sovereign fund is a primary savings account we created in 2008 and is perfectly usable,” Mantega told reporters today in Brasilia. “Nothing is more legitimate than using that fund to cover part of expenses.”

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