| RIO DE JANEIRO, June 14
RIO DE JANEIRO, June 14 President Michel Temer
has signaled his support for a plan to refinance 50 billion
reais ($15 billion) in debt owed by Brazilian states to the
development bank BNDES, a person with direct knowledge of the
matter said on Wednesday.
He told a dinner of Brazilian state governors in Brasilia
late on Tuesday that he wished to find a solution as soon as
possible to the mounting debt burden of regional governments,
according to the person, who requested anonymity to speak freely
about the matter.
The person said the refinancing of 20 billion reais of that
amount is "just a step away" and could be finalized by September
because of legislation that facilitates the renegotiation of
state liabilities with the bank.
The remaining amount may depend on an executive decree, said
the person. Temer's office did not immediately comment.
Several states have struggled to pay salaries for police and
doctors and to keep hospitals stocked with medical supplies.
Their finances have been squeezed by a steep decline in
commodity prices, a prolonged recession and years of budget
Since taking office a year ago, Temer has offered states
some debt relief without undermining his vow to narrow a record
high budget deficit.
Still, economists such as Insper professor Marcos Lisboa
warned Temer could water down his austerity plan to drum up
political support as the president faces a corruption probe.
($1 = 3.3157 reais)
(Writing by Guillermo Parra-Bernal; Editing by W Simon)