A corruption probe threatening to engulf Brazil’s government intensified as police arrested a former top minister of ex-President Luiz Inácio Lula da Silva for allegedly orchestrating a scheme that looted billions of dollars from oil giant Petróleo Brasileiro SA, The Wall Street Journal reported. Authorities say José Dirceu, who served as Mr.

Brazil has gone from being a motor of the world economy as one of the fast-growing so-called Bric nations to the sick man of the large emerging markets, the Financial Times reported. Unemployment is soaring, business confidence plummeting. Standard & Poor’s, the ratings agency, is considering cutting its investment grade rating to junk. The country is breaking records in all the wrong ways.

Standard & Poor’s warned Brazil on Tuesday that its investment grade rating was at risk as falling growth and political infighting hurt efforts to restore order to public finances. The agency placed Brazil’s foreign currency rating, which is one notch above junk, on negative outlook for possible downgrade, initially weakening Brazil’s currency, the real, up to 2 per cent against the dollar, the Financial Times reported.

A Brazilian court approved a debtor-in-possession loan to engineering firm OAS SA, the company said, after it earlier this year filed for bankruptcy protection in the wake of a corruption investigation that shut its access to refinancing. In a statement published late on Tuesday, OAS said judge Daniel Carnio Costa freed up the so-called DIP loan of 800 million reais ($254 million) after court-appointed administrator Alvarez & Marsal Holdings LLC gave the go-ahead for the financing facility.

Most industrialists acknowledge the need to tackle the budget deficit, which at 7 per cent last year was the worst in a decade, the Financial Times reported. But many industries in Brazil are heavily dependent on government protection, subsidies and tax incentives to survive in an economy that the World Bank regards as one of the world’s least competitive. Critics feel the axe is falling too heavily on the wrong areas, such as exports, investment and manufacturing.

Brazilian federal police carried out search-and-seizure requests Tuesday against several local politicians, including former President Fernando Collor de Mello, as part of an investigation into an alleged corruption scheme at state-run oil firm Petróleo Brasileiro SA, The Wall Street Journal reported. The police seized documents in the home and offices of several congressmen, including Mr. de Mello, according to a police spokesman. The spokesman declined to name the other politicians whose homes and offices were searched. From Mr.

Venezuela must refinance its foreign debt to improve government cash flow in the face of recession and soaring inflation, opposition leader Henrique Capriles said on Tuesday, but added a default would have "terrible consequences" for the country. The OPEC nation is struggling with the shrinking economy and chronic shortages of basic goods following last year's oil market rout, with bond payments taking up a growing portion of available hard currency. "We must sit down immediately and seek better conditions for debt payment," Capriles told a news conference.

On a cruise round the Mediterranean, Domingo Cavallo, Argentina’s economy minister in the run-up to the country’s dramatic economic collapse in 2001, was bemused when he was unable to use his credit card during a brief stop-off on Greek soil last week, the Financial Times reported.

Businesses avoid paying $200 billion annually in taxes by channeling their overseas’ investments through offshore financial hubs, a United Nations agency said Wednesday, The Wall Street Journal reported. The estimate by the United Nations Conference on Trade and Development is one of the first attempts by an international governmental organization to put a figure on tax avoidance by companies that record their profits in countries with low tax rates, regardless of where those profits are actually earned.

Brazilian engineering and construction conglomerate OAS S.A. late on Friday unveiled a restructuring plan to a Sao Paulo court, the latest step in a plan to avert bankruptcy amid a corruption scandal at Petróleo Brasileiro SA, Reuters reported. The plan, which still needs approval by the court, laid out two scenarios for the restructuring of about 8 billion reais ($2.5 billion) in debt, both counting on proceeds from asset sales and a debtor-in-possession (DIP) loan. OAS had until June 22 to present a plan.