Wednesday, May 28, 2003

IDB (INTERAMERICAN DEVELOPMENT BANK) WILL FINANCE USD 500 MILLION TO PRIVATE ENTERPRISES IN BRAZIL.
Mr. Enrique Iglesias, president of the bank, declared yesterday 27.5.2003, that the bank will offer USD 500 million credit to private enterprises in Brazil - emphasis on the foreign trade. Out of these USD 500 million, an amount of USD 110 million will be directed to BRADESCO - biggest brazilian private banking corporation. Mr. Iglesias also affirmed that, within two monthes, other two brazilian banks will have their shares - possibly ITAU and UNIBANCO. Additionally, Mr. Iglesias commented that the brazilian banks will have to pay to IDB an interest rate of just 3,0 per cent / a year.

Mr. Guido Mantega - planning minister in Brazil - went further and asked for more financing (bigger ones!) from IDB in order to expand the 'private enterprises in Brazil - emphasis on the foreign trade). Mr. Mantega wishes to improve the infra-structure of the exporting companies. The so-called "agri-business" might be preferably focused-privileged. Source: Gazeta Mercantil - Brazil.

Templarium comments the issue: brazilian banks get big loans from abroad (IDB - in this particular case); pay just 3,0 per cent a year to them, and charge the scandalous rate of 12,0 per cent a year from brazilians;or far much more! Banking in Brazil is an enormous source of "easy money"... - Needless to say that, in Brazil, the most profitable business is, yes!, banking. Thousands of small and medium size companies have gone bankrupted here because of the extremely high interest rate charged by the banks.