Brasília, 4/30/2004 (Agência Brasil) - The primary surplus target of 4.25% of GDP would be compromised if the minimum wage was bigger than US$87.63(R$ 260) declared minister of Planning, Guido Mantega, as he sought to justify the R$20 increase. Mantega pointed out that the budget had earmarked US$1.01 billion (R$3 billion) for a minimum wage increase, which would have been at R$256. The new salary will mean an expense of US$1.2 billion (R$3.650 billion), he explained.

Mantega went on to say that the government had been hoping for increased revenue in order to raise the minimum wage more, but that after checking the books for March and April it was clear that there was no way to raise the minimum more without compromising fiscal targets.

The minister said the government is determined to reach its fiscal goals and is certain that GDP growth will be 3.5% this year and 4% next year. "It is important for people to understand that we are growing. Vigorous growth is occurring. That is why we need money, so we can invest it and bring interest rates down and get the private sector moving," he declared.

In conclusion Mantega said that the government had been very successful last year in handling the economic crisis and dealing with the problems the previous administration had left.

Translator: Allen Bennett