UPDATE 1-Brazil says backs aid to Greece after remarks by its IMF rep

Thu Aug 1, 2013 5:42pm EDT

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BRASILIA Aug 1 (Reuters) - Brazil called back its International Monetary Fund representative on Thursday after he voiced opposition to fresh loans for debt-ridden Greece, a stance that the South American country said was taken without its support.

Finance Ministry Guido Mantega on Thursday phoned IMF Managing Director Christine Lagarde to clarify that Brazil's representative, Paulo Nogueira Batista, criticized additional aid for Greece without the authorization of the government.

Mantega "indicated to me that Brazil was fully supportive of Greece, the Greek program, and that if a vote could be retaken Brazil would support that program. And he said that himself," Lagarde said.

"It is most unfortunate that it happened in those circumstances, but I am very pleased that the position of Brazil could be rectified and clarified at the highest level," she added, while speaking to reporters in Washington.

Batista, who also represents 10 other nations at the Washington-based IMF, on Wednesday publicly criticized the IMF executive board's recent decision to release 1.7 billion euros of rescue loans to Greece. Brazil abstained from the vote.

In an unusually blunt statement, Batista said Greece's reform program was "unsatisfactory" and warned of a possible debt default based on the findings of a separate report published by the IMF on Wednesday. Batista said he was speaking only for himself.

In the past, the Brazilian government has criticized some of the tough fiscal controls imposed on debt-ridden European nations, saying the rigid spending constraints have slowed the economic recovery of the European Union.

Besides Brazil, Batista represents Cape Verde, Nicaragua, Ecuador, Guyana, Haiti, Panama, Suriname, Timor-Leste, Trinidad and Tobago and the Dominican Republic.

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