Brazil, facing a possible decline in economic growth in 2005, will need to renew a funding deal with the International Monetary Fund (IMF), Finance Minister Antonio Palocci said on Saturday. Brazil has not yet drawn on an existing IMF finance stream and, as recently as last year, Palocci had said he did not intend to renew the accord but would make a decision based on this year's economic conditions.
But he told reporters in London on the sidelines of a meeting of the Group of Seven industrial powers that a renewal of the deal was now necessary.
"Brazil has the necessity to renew this accord," Palocci said. He added that he had spoken with IMF Managing Director Rodrigo Rato and agreed that they would take a joint decision in March.
"We are in a final analysis of this position," Palocci said.
Brazil's GDP is estimated to have grown 5 percent in 2004 - the highest in a decade - after just 0.54 percent growth in 2003.
While Palocci remained positive about the country's economic outlook, economists have forecast that growth will slip back to between 3.5 and 4 percent this year.
Brazil has joined China, India and South Africa at the G7 meeting in London, along with Russia, which has been attending these discussions for some years.
These richer emerging economies are seeking a permanent seat at the G7, which comprises the United States, Japan, Germany, France, Britain, Italy and Canada.
Palocci conceded that Brazil still has to earn its place at the top table of economic policy-makers.
"To be a permanent member of the club of advanced countries means we have to be an advanced country," Palocci said.
"I suggested that all of us, Brazil, India, China and South Africa have to work to deserve more than an invite, a right to participate in an environment of a future G10 or G11.
"I think the development of the Brazilian economy, the potential power of Brazil and its emerging partners indicates that in a time, maybe not too far away, we will be able to achieve direct participation."
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