UPDATE 1-Brazil's Levy looks beyond austerity to shore up economy
(Adds Levy and analyst comments)
By Caio Saad and Alonso Soto
RIO DE JANEIRO/BRASILIA May 29 (Reuters) - The Brazilian government is looking beyond fiscal austerity to avoid a recession, Finance Minister Joaquim Levy said on Friday, signaling what could be a new phase in the administration's strategy to pull the economy out of its lull.
Speaking to business leaders in Rio de Janeiro, Levy said the government plans to announce an agricultural stimulus plan and an extensive infrastructure program to lure much-needed capital into the economy.
That pro-growth agenda was unfurled on the same day as data showing the economy contracted in the first quarter, setting the stage for what many think will be the country's worst recession in 25 years.
Without softening his message of austerity, Levy said the government is taking important measures to revive the once-booming economy.
"There is plenty to be done. We have already started and have seen some results," said Levy, adding the second quarter will be one of transition.
Picked by President Dilma Rousseff to undo many of the policy missteps threatening Brazil's investment-grade rating, Levy is seen as a strict manager determined to rebalance the public accounts at any cost.
Some lawmakers of Rousseff's own Workers Party blame Levy's orthodox policies for sinking the economy further into recession, and some have called on the former banking executive to quit. Continuación...