Brazilian officials are accustomed to shrugging off the country’s debt levels by comparing them with those of much more heavily indebted Europe.
Although this misses the point – Brazil’s public debt is more burdensome than in most other countries because it has some of the highest interest rates in the world – the argument is doubly wrong if a new study by Moody’s is to be believed.
The Moody’s paper,
For Latin American Sovereigns, Hidden Liabilities Add to Credit Risk, shows that Brazil’s government debt is equal to 100 per cent of GDP when indirect debt, such as that from pension schemes or guarantees for state-owned companies and banks, are included.
Mais
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