International financial negotiations and political actors: the breakup of IMF-Brasil relations during the Government of Juscelino Kubitschek (1957-1959)

Abstract

A crucial moment in the history of the relations between Brazil and the International Monetary Fund (IMF) took place during Juscelino Kubitschek's government (1956-1961). The IMF played an important role in the period, as foreign investments were of utmost importance to Kubitschek's economic program aimed at accelerating the country's industrialization process: the so-called Target's Plan (Plano de Metas). In 1958, Brazil and the Fund signed a stand-by agreement, which provided funds to Brazil conditioned to the implementation of a stabilization program. Facing the dilemma of obtaining external resources for countering imbalances in the country's balance of payments or implementing policies that could compromise the goals of his administration, Kubitschek chose the latter option, breaking relations with the IMF in 1959. Despite its enormous historical importance, the literature on the reasons that led to the breakup between Brazil and the IMF is scarce and lacks solid empirical basis. Through Brazilian, North American and IMF's (both private and public) official sources and newspapers, this project aims at understanding the reasons that encouraged Kubistchek administration's decision to breakup negotiations with the Fund in 1959, taking into account the negotiations within each one of the actors and between them. It is expected that this project may allow other researchers to think about broader (and contemporary) issues, such as economic multilateralism, relations between the IMF and developing countries (especially Latin American countries), and the implementation and effects of IMF programs in peripheral regions. (AU)