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Brazil's Senate OKs loan
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December 10, 1998: 2:14 p.m. ET
$41B IMF credit package approved; Central bank seeks to draw 1st $8.1B
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NEW YORK (CNNfn) - Brazil's Senate Thursday approved the terms of a $41 billion credit package put together by the International Monetary Fund to help the country survive a deep economic crisis.
The government had said it wanted the Senate to approve the deal before possibly taking out a first tranche of IMF credit.
The president of the upper house, Sen. Antonio Carlos Magalhaes, declared a motion in favor of the package had been approved after senators voted in a show of hands during Thursday's session in Brasilia.
After the vote, Brazilian Central Bank president Gustavo Franco said his nation would ask the IMF for an $8.1 billion installment. "Today we will send a telex to the IMF, the Bank of International Settlements and the Bank of Japan confirming our intention of taking out 90 percent of the first ($9 billion) tranche" of the financing package, Franco said.
The IMF agreed to the emergency rescue package last month in an effort to reinvigorate the country's battered currency and rescue Latin America's largest economy from impending collapse.
The emergency loan package includes $18 billion from the IMF and $4.5 billion each from the World Bank and Inter-American Development Bank (IADB). It also includes about $5 billion from the United States and another $9 billion from Japan and other bilateral donors.
The IMF said $37 billion of the total will be available to Brazil over the next 12 months, if needed. Moreover, the IMF said it could release another $9 billion immediately after its three-year loan package is approved by the IMF board.
The Brazilian government said it has gone along with a series of economic targets agreed to with the IMF. But a senior finance ministry official denied published reports that the Central Bank would consult the fund when it set monthly interest rates. 
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