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Brazil will next year no longer recognise the IMF official stationed in Brasília following complaints over the fund’s forecasts for Latin America’s largest economy.

“It has been years since they were needed here,” said finance minister Paulo Guedes. “They stayed because they like feijoada, football, good conversation and, from time to time, to criticise and make wrong predictions.”

Brazil will stop recognising the institution’s office in the capital from June 30, when the fund is due to replace its representative, said Guedes. The IMF in a statement acknowledged that it would close its office then.

The office is typically installed in countries that have received loans from the institution. Brazil exited its IMF programme in 2005 but the resident representative was “justified” since its economy is difficult to understand from Washington, said a person familiar with the matter.

The decision follows criticism from Guedes over the IMF’s forecasting in recent years, particularly last year during the height of the pandemic. He cited the fund’s estimate of a 9 per cent contraction in gross domestic product last year, which was worse than the actual 4 per cent drop.

“If they want, they can keep their office, but we’re officially saying we don’t need to have them here anymore,” said Guedes.

Guedes, a former fund manager from Rio de Janeiro, regularly accuses foreigners and Brazilians of talking down Latin America’s largest economy, which he says has entered a “V-shaped recovery” following the initial impact of the pandemic.

His ministry estimates that GDP will grow more than 5 per cent this year and 2 per cent next year, a rosier outlook than that of most economists who are forecasting stagnation or even recession in 2022. In the third quarter, the economy entered a technical recession as surging inflation dampened growth.


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