Brazil 2002

Brazil’s newly elected president, Luiz Inácio Lula da Silva and his predecessor, Fernando Henrique Cardoso


In Brazil , economic problems in the summer of 2002 coincided with imminent elections; opinion polls showed that the two leading candidates were both leftists who in the past had been sharply critical of both domestic and international economic policy. After a false start, the U.S. gave its approval to an IMF plan that would sharply restrict government spending and only disburse the funds if those restrictions were adhered to after the new president took office. Both candidates agreed to the policy. 1


1) Roubini and Setser (2004: ch. 4); “Logic of Bailout Prevails Again: Even Longtime Opponents of IMF Rescues Feared Crisis in Brazil,” Washington Post , 9 August 2002; “A Brave Bail-out: The IMF's Brazilian Package Marks a Change of Policy by the US Treasury,” Financial Times , 9 August 2002; “I.M.F. Loan to Brazil Also Shields U.S. Interests”; “Brazilians Find Political Cost for Help from I.M.F.,” both New York Times , 9, 11 August 2002.