January 6, 1999, Itamar Franco, the governor of the state of Minas Gerais, the second largest state in Brazil, announced a 90-day moratorium on the payment of debts to the federal government. Announcement triggered an increase in demand for the Brazilian currency, the real, and threatened macroeconomic stability, carefully constructed by President Fernando Henrique Cardoso in 1993. Confidence in the country by foreign investors was badly shaken. This case traces the origin of this crisis. "Hide
by Laura Alfaro, Yasheng Huang, Marios C. Kalochoritis Source: Harvard Business School 23 pages. Publication Date: Mar 05, 2001. Prod. #: 701079-PDF-ENG
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