BRAZIL | Expected growth rate approaching zero. In the latest official adjustment of the expected GDP growth rate, planning minister Guido Mantega told a congressional committee last week that it could end up somewhere between zero and 0.5% `or something like that'. Inflation is expected to be slightly higher that the 8.5% target: in the first 11 months it reached 8.74%. It was in order to curb inflation and `calm the markets' that the government increased the benchmark interest rate to 26.5% this year; it has since been lowered to 17%, apparently not enough to make an impact on growth this year. The government sees as highly positive the fact that the exchange rate has settled down close to R$3 per US dollar and the trade balance has accumulated a record surplus of US$22bn to end November.
CHILE | Industrial exports on the rise. Chile's industrial exports in the first 10 months of this year totalled US$7.98bn, or 14.6% more than in the same period of 2002. This took industry's share of total export earnings up to 47%, ahead of mining (42%) and agriculture (10%). The leading industrial exports are lightly processed primary products: at the top of the list are salmon (US$873m, up 18.8%) and cellulose (US$755m, up 9.6%). In terms of markets, the biggest increases were to Asia (22%), the European Union (18.6%), and Nafta (11.6%). The US accounts for 30% of all industrial exports.
PARAGUAY | Chasing the missing taxes. Despite the marked increase in tax collection, Paraguayan firms are still evading about 60% of their tax liabilities, according to President Nicanor Duarte. A random audit of government suppliers has already turned up one case of a firm that has been charged with not paying the 10% value-added tax (IVA) due on Gs/80bn (US$13.3m). Another six suppliers are to be audited next, and inspectors are looking into the use of phantom companies to dilute IVA liabilities. The government is barred from naming the firms involved until formal court proceedings are initiated. `From now on,' said Duarte, `everyone is going to pay equally, and you'll see who complains - the richest and those who have most lived off Paraguay.'
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