(Adds dividends data and context)
By Alonso Soto
BRASILIA May 30 Brazil had its biggest primary
budget surplus for the month of April in three years due to a
surge in extraordinary income from dividends and concession
premiums, central bank data showed on Friday.
Brazil posted a primary budget surplus of 16.896 billion
reais ($7.54 billion) in April, above the median forecast of 15
billion reais in a Reuters poll. It had a primary surplus of
3.58 billion reais in March.
The primary surplus, which represents the public sector's
excess revenue over expenditures before debt payments, is a key
indicator of a country's capacity to repay debt.
The surge in primary savings was mostly due to an increase
in the government's intake from concession premiums and
dividends from state-run companies. The central government's
dividend intake rose more than six-fold between January and
April, compared with the same period a year earlier, according
to Treasury data released on Thursday.
Brazil's public finances have deteriorated rapidly under the
government of President Dilma Rousseff, leading Standard and
Poor's to downgrade the country's sovereign debt rating closer
to junk status in March.
In the first four months of the year, the government has
been able to meet about 40 percent of its target for the primary
surplus for the year.
The government pledged to save at least 99 billion reais
this year in primary surplus, or 1.9 percent of the country's
GDP. Many economists see that target as out of reach unless the
government resorts to alternative accounting or receives
extraordinary revenues from concessions or tax settlements.
A recent slowdown in tax revenue and limited space to keep
collecting extraordinary revenues could drag down the primary
surplus in coming months, economists have warned.
($1=2.24 Brazilian reais)
(Reporting by Alonso Soto; Editing by Chizu Nomiyama; and Peter