Govt announces budget cut of over $18 billion in 2014

The Brazilian government has announced Thursday (Feb. 20) that cuts in the 2014 federal budget will amount to $18.34 billion. The government’s goal is to reach a GDP primary surplus of 1.9%, or $41.27 billion, for public debt payment.

According to Finance Minister Guido Mantega and Minister of Planning, Budget and Management Miriam Belchior, out of the $18.34 billion, $5.62 billion will be cut in mandatory spending and $12.70 billion in discretionary spending, i.e., resources whose use can de determined by the government.

For Minister Mantega, these budget reductions are beneficial to domestic and foreign markets and contribute to making economic agents more optimistic about Brazil.

These budget cuts will exceed those made in last year ($15.84 billion), but will still be lower than 2012 ($22.94 billion) and 2011 ($20.88 billion).

Budgets in the Ministries of Health, Education, Social Development and that of Science, Technology and Innovation will not be reduced, as they are seen by the government as high-priority areas.

Translated by Fabrício Ferreira