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Lula: IMF Won’t End Brazil’s Crisis

September 19, 2002

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BUENOS AIRES, Argentina (AP) _ Stepped up economic production and not foreign loans is the surest way out of the economic crises plaguing Brazil and Argentina, Brazilian presidential candidate Luiz Inacio Lula de Silva said Wednesday.

``I don’t believe that taking loans from the IMF will offer any economic salvation for Brazil or for Argentina,″ the 54-year-old politician said during a televised interview.

``I believe that Argentina’s recovery, and that of Brazil, will come from the productive capacity of industry and agriculture and tourism ... not from borrowed money.″

Lula, the candidate from the left-wing Workers Party, is the current favorite to win Brazil’s October 6 presidential election.

In August, the International Monetary Fund agreed to lend Brazil $30 billion to help South America’s largest economy fend off market jitters about whether the country would be able to meet its international debt payments.

However, the IMF said that only $6 billion of the loan could be used before the elections and reserved the right not to extend the rest of the cash to Brazil if the new president does not comply with economic policies set out under the loan.

Argentina, whose economy has been in a slump for four years, is currently negotiating with the IMF for new aid.

Lula said that if elected, he may not ask the IMF for the rest of the money, saying ``I’m going to work to make sure that Brazil does not need to take IMF money.″

Lula, who has a reputation as a critic of American foreign policy and the IMF, repeated that the only cure for the South America’s chronic economic woes is to develop a strong regional manufacturing and export platform.

Lula is well ahead in opinion polls. His closest rival is government-backed candidate Jose Serra.

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