RIO DE JANEIRO – Brazil's Finance Minister has announced nearly $7 billion in spending cuts aimed at covering an $8 billion shortfall to the 2016 budget.
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Joaquim Levy says the cuts are to include large-scale infrastructure projects initially aimed at stimulating the South American giant's now-stalling economy. Other savings will come from personnel cuts within Cabinet ministry staff, as well as other cuts to Brazil's bloated public sector.
Levy made the hotly anticipated announcement late Monday, days after revealing the projected $8 billion shortfall to next year's budget.
Brazil's economy is in recession, and the economic woes have contributed to President Dilma Rousseff's plummeting popularity ratings, which have dipped to single-digits.
Monday's announcement was seen as a test of Rousseff's willingness to make the hard and unpopular cuts Levy insists are necessary.