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Special report FIXING THE FINANCES THERE IS NO WAY ROUND PAINFUL REFORMS TO MAKE BRAZIL'S DEBTS SUSTAINABLE AND SPEED UP GROWTH FOR the past year the pundits have been arguing over
whether Brazil is bound to follow Argentina into default. Even after the IMF stepped in with a $30 billion loan last August, some remained convinced that Brazil's public-debt burden,
which almost doubled during Mr Cardoso's presidency, to 56% of GDP, had become unsustainable, and that sooner or later the country would have to “restructure”, willingly or otherwise.
Others maintained that the country's twin deficits were well under control, with the government consistently running primary surpluses (before interest payments) and the current-account
gap shrinking, thanks to a plunge in the _real_, all of which made a default seem a lot less likely. This article appeared in the Special report section of the print edition under the
headline “Fixing the finances” FROM THE FEBRUARY 22ND 2003 EDITION Discover stories from this section and more in the list of contents ⇒Explore the edition