Brazil's government on Friday unveiled measures to help the 27 state
governments increase investments to try to offset some of the effects
of the global crisis and offset weak domestic economic growth.
The government has created a new credit line for states, with 20
billion Brazilian reais in funds, which will offer 20-year loans at
subsidized rates, Finance Minister Guido Mantega told reporters at a
press conference in Brasilia. New loans can be approved faster than
through other financing mechanisms, he said.
The government is also examining how to increase the debt limits for
the states, and this will be announced in the next month or so, Mr.
Mantega said. The states' accounts are now safe, and the debts are
being paid regularly, he added.
The federal government will also relax some of the conditions for
state governments to establish partnerships with private-sector firms
for construction of projects such as subways and highways, including
new tax breaks, according to Mr. Mantega. The state governments will
be allowed to spend up to 5% of revenue on public-private
partnerships, up from the current limit of 3%, he said.
-Rogerio Jelmayer in Sao Paulo and Luciana Magalhaes in Brasilia
contributed to this article.
Write to Matthew Cowley at matthew.cowley@dowjones.com
(END) Dow Jones Newswires
June 15, 2012 13:05 ET (17:05 GMT)
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