Brazil Finance Minister Cancels G20 Trip To Turkey

The country's finance minister will no longer attend a G20 meeting in Turkey, ministry officials told Anadolu Agency on Thursday.



The Ministry of Finance told Anadolu Agency that Joaquim Levy would instead meet Thursday with the President Dilma Rousseff and Planning Minister Nelson Barbosa.



The emergency meeting is being called to find a way to strengthen unity between the government and the president's economic team, which Levy heads, after this week delivering for the first time a federal budget with a primary deficit of 0.5 percent of gross domestic product  -- 30.5 billion reais ($8.1 billion).



Media reports Thursday suggested the government will now aim for a primary budget surplus of 0.7 percent of GDP for the next year, with Rousseff urging her Cabinet to support the budget target and her finance minister.



Local media reported that Levy had called a meeting Wednesday with Rousseff and Vice President Michel Temer to demand greater support from the government, after feeling increasingly isolated, fueling speculation he could stand down from the role if more explicit backing were not given.



Rousseff gave a robust defense of the finance minister in a press conference later Wednesday, but rumors about his future sparked turmoil in early trading on the currency markets Thursday, with the real weakening nearly 1.5 percent against the dollar by 10.40 a.m. in Sao Paulo (GMT1340), when it bought 3.81 reais.



The currency pared losses, recovering to 3.76 reais by close of business, and matching Wednesday's closing price.



With Levy not traveling to Turkey, the president of Brazil's central bank, minister Alexandre Tombini, will now be the government's most senior representative at the G20 meeting, the Central Bank told Anadolu Agecny. Tombini will be joined by central bank director Tony Volpon and Brazil's Secretary for International Affairs Luis Antonio Balduino Carneiro, among others.



The G20 meeting will reunite finance, labor, and employment ministers, as well as central bank heads, from the world's 20 leading economies on Sept. 3-5 in the Turkish capital, Ankara.



The meetings will focus efforts on ensuring inclusive and robust growth through collective action, Turkish Deputy Prime Minister Cevdet Yilmaz said Thursday. 



The finance ministry confirmed that for now, Levy will travel to Spain and France as planned, on Sept. 7 and 8, respectively, for a seminar organized by El País and a meeting with the Organization for Economic Co-operation and Development.



Brazil recently entered a recession that economists believe could be the worst Latin America's biggest economy has seen in 25 years, after GDP contracted 1.9 percent in the second quarter of 2015.



Analysts expect the economy to shrink 2.26 percent in 2015 and 0.4 percent in 2016. - Sao Paulo