Brasília, June 18, 2003 (Agência Brasil - ABr) - "We have to free ourselves from the domain of debt and high interest rates, but without resorting to a moratorium or unilateral breach of contracts," affirmed the acting President, José de Alencar, reinforcing his stand on the need for the government to lower the prime interest rate (Selic). The Central Bank's Monetary Policy Committee (Copom) decided today to reduce the prime interest rate by 0.5%, to 26%.

According to Alencar, every percentage point in the prime rate represents R$ 6 billion per year in the country's debt. "Investors receive 18 times more than they would in 19 other countries with a payments capacity equal to ours." Alencar compared interest rates in China - a developing country, like Brazil - with those in the United States, where they do not exceed 2%.

Alencar emphasized that the country needs to end the foreign exchange bottleneck, without using the dollars that come and go and participate in the enormous profits made available by the Brazilian economy.

The acting President recalled that when Lula's Administration received the government, the situation was chaotic, with inflation resurging in a menacing fashion . "We required strong and decisive measures to prevent inflation from returning to dominate life in Brazil," he assessed, recalling that at the end of last year, the country was without credit. (DAS)