May 3, 2018 / 2:00 AM / a year ago

Brazil's Congress approves covering missed Venezuela payment

National Congress building can be seen near the columns of the Supreme Court building during sunrise in Brasilia, Brazil April 12, 2017. REUTERS/Ueslei Marcelino

SAO PAULO (Reuters) - A joint session of Brazil’s Congress on Wednesday passed a measure allowing the use of federal funds to pay off debts owed by Venezuela and Mozambique, according to a decision published on the Congress website.

Venezuela owes the vast majority of the nearly 1 billion reais ($281.60 million) owed to Brazil’s BNDES [BNDES.UL] state development bank and also to Credit Suisse (CSGN.S), payment of which is due May 8.

The Brazilian government, under former President Dilma Rousseff, had agreed to act as the guarantor of the loans. The funds were used by Venezuela and Mozambique to pay works carried out by Brazilian firms.

Brazilian President Michel Temer had earlier warned that if Congress did not approve covering the payment, the government would have been considered as having defaulted on the loans.

Reporting by Brad Brooks; Editing by Sandra Maler

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