Brasília - The Managing Director of the International Monetary Fund (IMF), Rodrigo Rato, met on Friday (3) with 14 representatives of civil society. Members of the landless rural workers movement, NGO's, university professors, journalists, students and the Vice-President of the Brazilian Bar Association (OAB) attended the encounter. They were unanimous in their positions. They demanded an end to foreign debt payments.

During the 45 minutes the meeting lasted, Rato accepted all the criticisms of the Fund's activities in Brazil, but he stressed that the IMF's positive acts outweigh the negative ones. The main point in favor, according to him, is that the Fund is the only institution available to run to for help in times of crisis.

He affirmed that Brazil's present situation is stable. For Rato, this is the first time in 30 years that the country has attained this status. This is the most important aspect, because, in his view, economic stability is more important than social stability. "Only a stable economic situation is capable of transforming society," he summed up.

Rato began the meeting by recalling that the IMF is controlled by governments, which founded it and direct it. "The legitimate governments of each country are the ones that draw up the policies. And the weight of each government is determined by its shares of participation in the capital," he explained.

Although insisting on the independence of nations, Rato underscored that Brazil is in need of structural reforms, such as untying budget resources and reorganizing labor relations. "These reforms have a greater weight in trade agreements."

According to Rato, the Fund has already assisted various countries. IMF support restored nearly bankrupt economies. "For example, the IMF revived Brazil in 2002, England in '78, Canada in the '80's, and Spain in the decade of the '60's."

The Director claimed that the IMF is not to blame for the increase in poverty. According to him, the countries that took on debts they are unable to pay are the true villains, since they shift the burden to future generations. "No country emerged from poverty in the last 15 years with an increase in extreme poverty, inflation, or government debt. Macroeconomic stability is the friend, not the enemy, of poverty."

The Vice-President of the OAB, Aristóteles Atheniense, considered the meeting useful. But he commented that Rato failed to reply to various questions. The main one, in his view, was a question concerning an item in the Brazilian Constitution. The law requires Congress to conduct annual audits on payment of the debt. "The Brazilian population needs to know how much it owes and where this debt comes from. I did not obtain this response from the Director."

Atheniense also remarked that the creation of a new credit line for future cases of financial instability is a contradiction. "If revenue collection in Brazil has been so successful, and economic policy has achieved so many victories, why do we need a reserve fund?" he queried.

For her part, Sandra Quintela, representative of the NGO Brazil Network, considered the meeting a "conversation between deaf people." According to her, the representatives of society presented their viewpoints, and Rodrigo Rato spoke in favor of the IMF. "We were not given the chance to respond to Mr. Rato's comments. It was a conversation between deaf people," she concluded.

Agência Brasil
Reporter: Lilian Macedo
Translator: David Silberstein
09/06/2004