Mark Connally

2.

Brazil is making a large effort to begin repaying its debt of over 67 billion dollars to foreign banks. They have begun meetings with the IMF and are planning to borrow money, once again, to eliminate older debts. They are doing this so that they will be able to deal with the problem at hand, their last year’s debt. Many are reluctant, but most will comply in attempts to rid Brazil of its economically ailing debt.

To begin, Brazil refuses to pay full interest until creditors will promise new bank loans totaling at least 2\3 of the interest owed at that year. They also said that debt talks must be long-term settlements before full interest will be paid. The banks however have also made demands, and at the beginning of the year Brazil will pay interest on its short-term and middle-term loans, but will not pay on the long-term loans until agreements are reached.

Despite Brazils failure to resume full interest payments, the U.S. still hasn’t convened to downgrading holdings of Brazilian debt. Brazil is trying to better relations to creditors by offering 65 million to clear its 87’ interest on medium and long-term rates, showing that they were working fast to find a solution to this nagging problem. As for the short-term, Brazil stopped paying interest on some 67 billion dollars, and is attempting to repay this by borrowing 3 billion dollars from some 100 banks, which is still not enough.

Mexican government has meet with bank creditors to try and calm them over that countries existing debt issues. The borrowed 6 billion last year, and will use that up which anger banks due to the fact that they are in debt and are still borrowing up to 1.2 billion dollars. To repay this Mexico will issue 10 billion dollars of 20-year bonds, some of which are backed by the U.S treasury 20 year zero coupons, bonds.

Argentina held talks in Washington to make sure that it still had access to the IMF and World Bank loans and the last portion of a 1.95billion bank loan of last year. Argentina was seeking bridge loans to boost its depleted foreign-exchange reserves.