Betim, Minas Gerais 3/22/04(Agência Brasil) - On Friday, during a visit to a Fiat factory in Betim, president Luiz Inácio Lula da Silva said that although Brazilian interest rates remain high, they are the lowest in ten years. He added that for interest rates to fall, the country has to have domestic and foreign credibility. Therefore, he said, price controls were out of the question. As for further reductions in import surtaxes, he said he was opposed to them because domestic industry would not be able to face the competition and would have to lay off workers.

"We have decided to control inflation and to control inflation we have some tools. One of those tools is the interest rate. When we took office it was high and it remains high today. But what those who criticize us must remember is that at the moment it is the lowest it has been for 10 years," said the president.

Lula went on to point out that interest rates will fall when the country has credibillity. "When investors see that the country is serious, they will fall. In the meantime we must get the country growing again like we are growing this year. We have to get the country creating jobs and the industrial sector working at total capacity."

In a speech to some 5,000 workers at the Fiat factory, Lula called for an agreement between the various levels of government and automakers with the objective of reducing car prices so sales would rise and jobs could be created.

While he was in Betim, Lula also signed contracts for social inclusion programs in communities in Betim, Belo Horizonte and Minas Novas (in the Vale do Jequitinhonha). The programs will provide direct benefits to 22,000 people at a cost of around US$1.1 million (R$3.2 million) through activities run by government and non-government insitutions. (translator: Allen Bennett)