Minister rebuts criticism and claims there are “guarantees”; Resources used to cover eventual defaults come from a fund maintained by the Treasury
The Minister of Secom (Secretary of Social Communication of the Presidency of the Republic), Paulo Pimenta, denied damages to the federal government for financing from the BNDES (National Bank for Economic and Social Development) for works in other countries. In your profile on Twitter, refuted criticism on the subject and said that “there is no risk of default” to Brazil.
There is, however, the FGE (Export Guarantee Fund), created in September 1997 and maintained by the National Treasury. In case of default by the importer –company or foreign country–, the fund is activated to reimburse the debt. In practice, when an installment is not paid by the debtor, the funds leave Brazil.
“There is no risk of default, since the payment guarantee is the importers’ receivables, if they do not pay, the insurance covers this loss”, wrote the minister.
Rebutting criticism of the president’s statement Luiz Inacio Lula da Silva (PT) that Brazil will again finance projects in neighboring countries, Pimenta said that the state development bank will finance Brazilian labor to work abroad.
“What the BNDES does is finance the export of services by Brazilian companies, adding value and generating qualified jobs in Brazil”, added.
The minister also said that he is “too much misinformation” regarding the topic. According to him, “saying that Brazil finances works abroad is nothing more than a work of fiction, since the financing is given to the Brazilian company that will export and generate jobs”.
Here is the Minister’s publication on the subject:
IF WITH
The official profile on twitter from Secom also made publications on the subject.
The folder endorsed the minister’s statements and highlighted that “There is no risk of harm”. The argument cited by the agency is that, in addition to the BNDES agreements having guarantees and insurance, there is “a long tradition of getting back what you lent”.
The profile of the folder also shared 4 images. See below:
LULA
On Monday (January 23), during an official visit to Argentina, Lula mentioned the BNDES as a possible financier of the Argentine gas pipeline of Vaca Muerta. For the Chief Executive, criticisms of Brazil’s financial support for the undertaking are “pure ignorance”.
Even before the president confirmed Brazil’s decision, the Argentine government had already anticipated it in 2022, after the election of the PT, saying that it would receive Brazilian contribution for the gas pipeline in question.
Argentina’s Secretary of Energy, Flavia Royón, said on December 12, 2022 that her country had $689 million BNDES financing to complete the construction of a section of the work.
DEBTS
According to BNDES data, the FGE paid US$ 977 million in compensation to the federal development bank for unpaid installments in neighboring countries. The outstanding balance includes goods and services located in Venezuela (US$ 641 million), Cuba (US$ 214 million) and Mozambique (US$ 122 million).
The FGE will transfer to the BNDES US$ 53 million in overdue installments. Of this amount, approximately US$ 40 million correspond to works in Venezuela and US$ 13 million to services in Cuba.
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