Brazil's Rousseff set to announce education spending cuts- sources

jueves 30 de julio de 2015 13:39 GYT

(Adds context on Brazilian education, quote)

By Luciana Otoni and Asher Levine

BRASILIA/SAO PAULO, July 30 (Reuters) - Brazil is expected to announce another deep cut to education spending on Thursday, the latest step back from President Dilma Rousseff's pledge to turn the Latin American giant into an "education nation" in her second term.

Brazil will further reduce the amount it spends on education by up to 2 billion reais ($593.4 million) this year as part of a round of budget cuts announced last week, two government sources with knowledge of the situation said on Thursday.

The reduction comes on top of nearly 9.5 billion reais in education spending cuts implemented in May as part of the government's effort to slash expenditures and ward off a sovereign credit downgrade by rating agencies.

Shares of private education companies Kroton Educacional SA and Estacio Participacoes SA both extended early losses, falling by about 5 percent in Sao Paulo trading.

At her second inauguration earlier this year Rousseff pledged to focus on education, heralding "education nation" as her administration's motto. The phrase is stamped on nearly all official communiques and is visible behind the president at most press conferences.

Last year Brazil's federal government spent 23 percent of its tax income on education, well above the average of developed countries.

Still, low learning achievement and high dropout levels persist, dragging on productivity and hampering the country's competitiveness in global markets.   Continuación...