By Alonso Soto and Luciana Otoni
BRASILIA, Jan 30 (Reuters) - Brazil failed to reach its primary budget surplus goal last year in an expected miss that has raised worries about the government's commitment to the fiscal discipline that helped the Latin American giant secure a decade of economic stability.
Brazil posted a primary surplus of 104.951 billion reais ($53 billion) last year, the equivalent of 2.38 percent of gross domestic product, according to central bank data released on Wednesday. That is way below the annual target of 139.8 billion reais, or about 3.1 percent of GDP.
For months officials have said the country was not going to meet the target after the government handed out billions of dollars in tax incentives last year to revive an economy struggling with high production costs and a fragile global outlook.
As the recovery continues to disappoint, the government of President Dilma Rousseff is debating whether to lower the primary surplus target to free up funds for investment in a bid to bolster the economy and bring clarity to public accounts.
Brazil posted a surplus of 22.252 billion reais in December after a deficit of 5.515 billion reais in November.
The primary budget surplus is a gauge closely watched by investors because it measures a country's ability to service its debt. It represents the excess of revenue over expenditures before interest payments are taken into account.
The government has resorted to alternative accounting methods and cash from its sovereign wealth fund to meet its primary surplus target on paper. Brazilian law allows the government to exclude some public investments from its accounts to reach the target, though that methodology is not recognized by some foreign observers like the International Monetary Fund.
($1 = 1.98 reais)
(Reporting by Alonso Soto, Luciana Otoni and Tiago Pariz Editing by W Simon) Keywords: BRAZIL ECONOMY/BUDGET
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