By Marcela Ayres
(Reuters) -Brazil Finance Minister Fernando Haddad does not believe the country can put its public finances in order without also addressing the need for economic growth, he said on Monday.
“This should not be confused with any leniency toward inflation,” he added during remarks at an event hosted by Itau BBA in Sao Paulo.
Haddad said it was important to be cautious when discussing fiscal adjustment, “not because it isn’t crucial for debt sustainability, but because it needs to be fair and intelligent.”
According to the minister, public spending in Latin America’s largest economy averaged around 19.5% of gross domestic product over the last decade, excluding the pandemic, and is currently below 19%.
He said this reduction was a result of trimming non-essential expenditures under the administration of leftist President Luiz Inacio Lula da Silva and was not from cuts to health and education.
Regarding the 50% tariffs imposed by the U.S. since August on many Brazilian goods, the minister said: “I want to believe that, at some point, a rational debate with the United States will begin.”
Last week, U.S. President Donald Trump said he planned to meet Lula after months of sparring between the two leaders over what the White House has called a “witch hunt” in Brazil against former President Jair Bolsonaro, a Trump ally.
Bolsonaro was sentenced to 27 years in prison after being convicted of plotting a coup to remain in power after losing the 2022 election.
(Reporting by Marcela Ayres; Editing by Louise Heavens and Barbara Lewis)
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