Brazilian president rules out recession, expresses hope for 2010

"We will grow less than we forecast. But we will not go into a recession. I can say to all of you today that many sectors of the Brazilian economy are now on track for recovery," Luiz Inacio Lula da Silva, president of Brazil, told in an exclusive interview with three journalists from the Turkish press.Â

 

Lula is currently in Istanbul to attend a conference organized by the Turkish-Brazilian Business Council of Foreign Economic Relations Board. He is accompanied by business executives from various companies including state oil company Petrobras and aircraft manufacturer Embraer.

 

He held talks with Turkish Prime Minister Tayyip Erdogan on Wednesday and is scheduled to meet President Abdullah Gul in Ankara on Friday.

 

Lula said the 304-billion-dollar program, launched in 2007, will increase investments in infrastructure projects like highways, roads and ports.

 

"It is now in full spin, because when you start developing public works, it sometimes takes two years and so now this 304-billion-dollars is being pumped into the economy to create jobs in the infrastructure," Lula said, adding the Brazilian government announced a new housing program for low income families, in which one million new homes will be built.

 

Lula said his government aimed at recording a sustainable growth rate of 5-6 percent but due to the problems that arose from the global credit crunch it is unlikely to realize this target.

 

Earlier this week, Brazilian Planning Minister Paulo Bernardo said the government will cut its 2009 growth forecast to 0.7 percent, Brazilian media reported.

 

The economy shrank 3.6 percent in the fourth quarter of 2008 and the latest Central Bank survey showed analysts expect a 0.49 percent contraction in 2009. If the economy contracts in the first quarter it will formally place Brazil in recession.

 

Lula declined to give any economic growth figures for 2009, saying that when a president says a figure this is perceived as absolute number.

 

"I believe Brazil will show strong recovery signs in the year of 2009 and we will go to 2010 in a much better position. I will continue to pray for Obama and the European Union because the recovery of U.S. and the European economy is important," he added.