The Brazilian government announced Wednesday, February 9, budget cuts of $ 30 billion (about EUR 22 billion) in 2011 to curb accelerating inflation, but they receive no social programs or investments in infrastructure. The government Dilma Rousseff, who took office on 1 January, has pledged to reduce public spending in particular to contain accelerating inflation.
"We are removing all tax incentives that have been made to support the Brazilian economy in 2009 and 2010 when, due to the global crisis, the government carried out exemptions (tax), provided grants and increased spending, "said Finance Minister Guido Mantega. These cuts represent 1.2% of GDP, the Minister has assessed this year at 2 500 billion.
They will focus on public expenditure and affect "all departments," says Mantegna. The Minister of Planning, Miriam Belchior, said: "We are making cuts in spending on social programs now and investment." "There will be no cuts" in the flagship program of accelerated growth (CAP ), which provided huge investments in infrastructure, she said.
The Finance Minister said that the adjustment announced by the government aimed to "ensure the continued sustainable growth" of the Brazilian economy. The government's goal for 2011 is to achieve an increase of 5% of GDP, he said, after 7.5% in 2010. He said the government would seek to keep inflation under control, reduce the public deficit and debt.
The new president wants to include pledges to foreign investors that Brazil is in dire need to complete the renovation of its infrastructure, particularly in view of the football World Cup in 2014 and 2016 Olympics. These budget cuts should help to reduce demand and therefore inflation, which reached 5.9% in 2010, largely immediately above the government target, which was set at 4.5%.
In January 2011 the price increase has continued unabated over a year. 
"We are removing all tax incentives that have been made to support the Brazilian economy in 2009 and 2010 when, due to the global crisis, the government carried out exemptions (tax), provided grants and increased spending, "said Finance Minister Guido Mantega. These cuts represent 1.2% of GDP, the Minister has assessed this year at 2 500 billion.
They will focus on public expenditure and affect "all departments," says Mantegna. The Minister of Planning, Miriam Belchior, said: "We are making cuts in spending on social programs now and investment." "There will be no cuts" in the flagship program of accelerated growth (CAP ), which provided huge investments in infrastructure, she said.
The Finance Minister said that the adjustment announced by the government aimed to "ensure the continued sustainable growth" of the Brazilian economy. The government's goal for 2011 is to achieve an increase of 5% of GDP, he said, after 7.5% in 2010. He said the government would seek to keep inflation under control, reduce the public deficit and debt.
The new president wants to include pledges to foreign investors that Brazil is in dire need to complete the renovation of its infrastructure, particularly in view of the football World Cup in 2014 and 2016 Olympics. These budget cuts should help to reduce demand and therefore inflation, which reached 5.9% in 2010, largely immediately above the government target, which was set at 4.5%.
In January 2011 the price increase has continued unabated over a year.
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