Nov. 9 (Bloomberg) -- Brazil will consider an economic stimulus plan after seeing how the government's efforts to unfreeze credit markets take hold, Central Bank President Henrique Meirelles said.

Meirelles, in an interview with Bloomberg Television, said lending is ``slowly recovering'' thanks to measures the government has taken such as lowering reserve requirements and having state-controlled banks boost credit to industries hurt by the global financial crisis.

``We have to see effects of all this in the real economy to see whether other steps will be necessary,'' Meirelles, 63, said when asked whether Brazil should consider an economic stimulus package.

Finance ministers and central bankers from the Group of 20 nations said in a statement today from Sao Paulo that fiscal polices were an ``important instrument'' to help get through the crisis. China today pledged to spend $586 billion to bolster growth in the fourth-largest economy and prevent the world from falling into a recession. The International Monetary Fund and U.K. Primer Minister Gordon Brown have been campaigning for a coordinated fiscal stimulus plan that would span the globe.

`Substantial Slowdown'

Brazil will be affected by a ``substantial slowdown'' in global growth next year, Meirelles said. Brazil, Latin America's largest economy, will probably grow more than the global average of about 2 percent, he said.

``The crisis has to be taken very seriously, but each country will adopt its own liquidity, expanding policies depending on their individual situation,'' Meirelles said.

Most Latin American countries, including Brazil and Mexico, don't have large enough surpluses to support additional spending, and may have trouble financing such a plan as investors stay away from emerging market debt, said Gray Newman, chief Latin America economist at Morgan Stanley.

``With the exception of Chile, for everyone else in Latin America fiscal stimulus is a way to describe additional debt financing,'' Newman, who is based in New York, said in a telephone interview. ``In the global context, there's a limited appetite for new debt.''

Stimulus Spending

Brazilian Finance Minister Guido Mantega said today that the government is prepared to boost public spending to sustain economic growth ``if needed.''

Inflationary pressures caused by a two-month, 20 percent tumble in the local currency are making it harder to loosen real interest rates that are the second highest after Turkey among 54 countries tracked by Bloomberg.

Brazil's central bank cited ``relatively widespread'' inflation in its decision Oct. 29 to leave its benchmark interest rate unchanged at 13.75 percent, according to the minutes of the meeting published last week.

Meirelles said international reserves are at ``extremely comfortable'' levels and serve as an important tool to stabilize the banking system. He didn't rule out further consolidation in Brazil's banking system after Banco Itau Holding Financiera SA disclosed on Nov. 3 it will acquire Uniao de Bancos Brasileiros SA to create Latin America's largest bank.

``Consolidation is occurring worldwide and is natural given the deleveraging that's taking place,'' said Meirelles.

To contact the reporters on this story: Joshua Goodman in Rio de Janeiro at jgoodman19@bloomberg.net or; Camila Fontana in Sao Paulo at cfontana@bloomberg.net

Last Updated: November 9, 2008 17:41 EST