Minister of the Supreme Court orders the release of Paulo Bernardo, former Minister of PT who was in prison for the past six day

Bela Megale, Mario Cesar Carvalho,  Márcio Falcão & Leandro Colon – Folha de S.Paulo, 06/29/16

The Supreme Court Minister, Dias Toffoli decided on Wednesday (June 29) to release the former Minister Paulo Bernardo, detained in the Operation Custo Brasil (Cost Brazil), an investigation into the illicit activity of the Ministry of Planning. He was arrested and imprisoned Thursday, June 23.

Toffoli said that there is no part of the process that justifies the order for preventive arrest. There is no indication that Paulo Bernardo will flee the country, or a risk of his interference in the investigations, thereby granting him the right to house arrest.

The Minister determined that the São Paulo Judicial System, which is responsible for the current operation, reevaluate the necessity to apply cautionary measures. After Toffoli’s decision, judge Paulo Bueno de Azevedo decided that Bernardo would spend the duration of his trial under house arrest, he will have to attend a judicial session every fifteen days, cannot contact others who are being investigated or occupy public office. He will also have to hand in his passport to the police.

Paulo Bernardo’s release should happen during the next few hours, after the notification from Azevedo.

In his decision, the Minister criticized the use of preventive imprisonment, which represents the anticipation of punishment and cited the case of the Mensalão, the worker’s party first major political scandal, as an example.

“Not even in the in case 470, colloquially known as the Mensalão case and conducted by the former minister, Joaquim Barbosa, was there a decree for preventive prisons. In mensalão, all the defendants were charged guilty and have completed or are in the process of completing their sentence,” said Toffoli.

Toffoli also affirmed that this was an “illegal embarrassment, correctable through habeas corpus.” “There is no need to add that the order for the defendant’s preventative imprisonment it needed to be verified by the Supreme Court, which, in this case, cannot be substituted,” he added.

The Minister affirmed that the judicial decision to arrest Paulo Bernardo, “does not indicate one sole factual element” which proves he could jeopardize the investigation.

“The judge’s first hand decision is fragilely based, in the common conjecture that the accuser, given his position as former Minister and his connections with other people and companies who are also being investigated in this operation, could possibly interfere in the production of evidence, but does not indicate a sole factual element that could sustain these connections,” he said.

The Minster partially responded to an appeal made by Paulo Bernardo’s lawyer to the Supreme Court, which questioned that legality in the action determined by the judicial branch from São Paulo. The appeal signed by the defendants, Juliano Breda, Rodrigo Mudrovitsch and Verônica Sterman supported the argument that the São Paulo’s court hindered the legislation by conducting investigative speculation linked to Senator Gleisi Hoffman(PT- PR)., who must be overseen by the Supreme Court, given the constitutional immunity.

The defendant’s ask for an annulment of the action involving Paulo Bernarndo in São Paulo and requested that his case were to be conducted by the Supreme Court, since many of the related evidence are similar to ones involving his wife, the senator Gleisi Hoffman (PT-PR).

Toffoli did not identify indices of usurpation from the Sao Paulo Judicial Court in the case that justifies a change in courts from federal to national.

The minister said that the Supreme Court has already identified the Consist Company’s role  and has proceeded, at first hand, to the suspects who do not have constitutional immunity, which is the case with Paulo Bernardo.

“The arrest was absolutely illegal and profoundly unfair. The decision strictly followed the constitution and its Supreme Court precedents,” said Juliano Breda to Folha.

In a statement, Bernardo’s lawyers confirmed that the decision “deconstructed all of the foundations for Paulo Bernardo’s arrest. It became clear that the foundations were vague and that the legal requisites and constitutional were not present”.

Gleisi commended the release of the former minister during a session of the Impeachment commission stating that “This is essential for me because there were no grounds to justify his arrest. We never refused to collaborate with the investigations,” she said. “I want to express my condolences about this case. In this country, we condemn before acquiring proof and information,” she emphasized.

The former minister in Lula and Dilma governments, Paulo Bernardo was arrested this past Thursday (23) in the Operation Custo Brasil (Brazil Cost), an extension of the Car Wash (Lava Jato). The politician from the worker’s party (PT) is accused of being a major beneficiary from the contractors’ kickbacks in the Ministry of Planning from 2010 until 2015.

Toffoli was the Worker’s Party lawyer during former president, Luiz Inácio Lula da Silva’s campaign in 2002 and 2006. He was nominated Supreme Court Minister in 2009 and was seen as a close friend to the party, but has kept his distance from the party ever since Dilma was elected. Today, he tends to align opinions with his Minister colleague, Gilmar Mendes, the Worker’s Party greatest opposition inside the Supreme Court.

A former Minister during the governments of Lula and Dilma, Paulo Bernardo was arrested last Thursday the 23rd as part of the investigations into the irregularities in the Ministry of Planning. Bernardo, a member of the Worker’s Party, has been accused of benefiting from bribes paid to the Ministry of Planning between 2010 to 2015.

Investigators from the Police and the Public Ministry estimate that about 100 million reais were sent from software company Consist, responsible for the administration of cosigned credits  to the Ministry of Planning as kickbacks.

The company received almost one Real for every loan payment whose actual value was 0.30 Reals. According to investigators, Paulo Bernardo and the Worker’s Party were part of those who received the surplus money.

Bernardo denies the accusation that he personally acquired  seven million reals in kickbacks.

Paulo Bueno de Azevedo, the judge who ruled that Bernardo should be in prison, defends his decision saying that “it was necessary to maintain public order, punish criminal action and aid in the application of the law”.

This past Wednesday, Judge Azevedo sent a statement to the Supreme Court that he was not informed by the Federal Police nor the Public Ministry that the detainment of the former minister had occurred in the office of his wife, Senator Gleisi Hoffmann.

The Senator is not the target of this investigation; however, she is now being investigated by the Supreme Court due to her husband’s involvement. According to investigators, information from Bernardo’s case should be used in her eventual investigation.

Azevedo defended the legality of his decision and said that Gleisi’s office does not have a privileged protection from judicial operations, therefore, would not require the former authorization from the Supreme Court to search the office.

The judge clarified that she had never been investigated or the target of the action for his arrest and that Bernardo clarified once arrested that the majority of his time was spent at his own residency in Brasilia.

The information from the judge’s ruling was sent to minister of the Supreme Court Celso de Mellos who asked for a clarification after the Senate examined the legality of an intrusion into the office of Gleisi without specific authorization by the Supreme Court.

The Senate argued that because Gleisi’s office is owned by the House, it is therefore given immunity in the face of legal action. Only the Supreme Court can give the permission for action to be taken in such.

The judge continued to defend his decision stating that “Although the House owns the office, it is still public property and as such there exists no legal restrictions on search and detainment in such. Unlike the Senator, the apartment does not have immunity to judicial action”.

Read the Original Article in Portuguese…

Translation By The Brazil Institute (Julia Fonteles & Therese Kuester)


Brazil election jitters may hit investment in 2014

Alonso Soto & Luciana Otoni – Reuters, 4/8/2014

Brazil’s presidential vote will likely delay some investment decisions this year but spending on infrastructure is expected to remain strong, a senior government official told Reuters on Tuesday.

Although President Dilma Rousseff is the favorite to win the October 5 general election, many investors could withhold funds until the next government outlines its plans for the following four years, which could hamper the country’s already slow economic growth.

“It is obvious that businesses will delay some investments until after the election to have more clarity,” said the official, who asked not to be named because he is not allowed to speak publicly.

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What’s holding back Brazil?

Otaviano Canuto – Project Syndicate, 2/21/2014

One often hears that Brazil’s economy is stuck in the “middle-income trap.” Since the debt crisis of the 1980’s, Brazil has failed to revive the structural transformation and per capita income growth that had characterized the previous three decades. But, with the right mix of policies, it could finally change its fortunes.

The prevailing explanation for Brazil’s failure to achieve high-income status lumps the country together with other middle-income economies, all of which transferred unskilled workers from labor-intensive occupations to more modern manufacturing or service industries. While these new jobs did not require significant upgrading of skills, they employed higher levels of embedded technology, imported from wealthier countries and adapted to local conditions. Together with urbanization, this boosted total factor productivity (TFP), leading to GDP growth far beyond what could be explained by the expansion of labor, capital, and other physical factors of production, thereby lifting the economy to the middle-income bracket.

Progressing to the next stage of economic development is more difficult, reflected in the fact that only 13 of 101 middle-income economies in 1960 reached high-income status by 2008. According to the dominant view, success hinges on an economy’s ability to continue raising TFP by moving up the manufacturing, service, or agriculture value chain toward higher-value-added activities that require more sophisticated technologies, higher-quality human capital, and intangible assets like design and organizational capabilities.

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Brazil looks outward, cautiously

Tim Ridout – The German Marshall Fund of the United States, 2/18/2014

In January, Brazilian President Dilma Rousseff attended the World Economic Forum in Davos for the first time in her three-year presidency. The foreign and trade policy platform of her Workers’ Party (PT) has been premised on a declining West, a transformed international order favoring emerging economies, and skepticism of free trade and open markets. But Rousseff is feeling intense pressure from her people to deliver better government services and economic prospects, as evidenced by massive street protests last June.

Rousseff’s visit to Davos came as the EU and Mercosur prepare toexchange proposals in newly revived free trade negotiations. She is also heading to Brussels on February 24 for a summit with EU leaders, where they are expected to discuss the negotiations and to sign a bilateral air travel pact that will increase passenger volumes between Brazil and Europe.

After a spate of economic growth that peaked in 2010 at 7.5 percent, Brazil’s economy slowed to 2.7 percent in 2011 and 1 percent in 2012. The growth rate for 2013 is expected to be about 2.5 percent. These disappointing numbers can be attributed partly to the drop in global commodity prices, but also to Brazil’s protectionist policies, poor infrastructure, unwieldy bureaucratic red tape, and its statist approach to investment. The Brazilian economy has not proven nimble enough to adjust to changing global realities, especially as investment flows back to the United States. Rousseff may have had little choice but to reassure business leaders at Davos that Brazil is committed to fiscal responsibility, openness to investment, combating inflation, and maintaining a floating currency.

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Why is Brazil so expensive?

The Economist, 09/30/2013

TRAVELLERS have long known that the richer a country, the more likely a visit is to burn a hole in their wallets. A recent survey by Tripadvisor, a travel website, put Oslo, the capital of super-rich Norway, as the world’s priciest destination, with a one-night stay in a four-star hotel with dinner and drinks for two costing more than $600. But near the top of the sticker-shock rankings is a surprise entry: upper-middle-income Brazil. Hotels in São Paulo, the business capital, or beachside Rio de Janeiro, cost more than in London or Zurich. Visitors who go window-shopping will find the high prices hit locals too. Clothes, cosmetics, electronics and cars are all more expensive, sometimes much more, than in most other places. The Economist’s Big Mac Index finds Brazilian burgers are dearer than everywhere else except in three much richer countries, (Norway, Sweden, Switzerland) and one dysfunctional one (Venezuela). So why is Brazil so pricey?

A special report in this week’s issue explores the question in more detail. A big part of the answer is currency appreciation, caused by economic stabilisation in the 1990s and a huge increase in commodity exports since then. A decade ago a dollar bought 3.5 reais; it now buys less than 2.3 reais—which understates the scale of the change, since Brazil’s inflation was much higher, so reais should have become cheaper, not more expensive. For Brazilians, though, currency appreciation has actually made life cheaper by cutting the price of imports. They point to the fabled custo Brasil (Brazil cost), as the country’s value-for-money problem has long been known. IMF figures show that in most poor and middle-income countries, money goes further than market rates would suggest because wages are lower and non-tradable goods are cheaper. A Mexican’s spending power, for example, is 45% higher at home than if he bought dollars and shopped across the border. But a Brazilian can buy little more at home than he can in the United States.

The custo Brasil has many ingredients, including high taxes (36% of GDP, way out of line with the 21% average for upper-middle-income countries), swingeing import duties and rigid labour laws that make it hard to use workers efficiently. Poor roads and a limited rail network push up freight costs. High interest rates mean firms must spend a packet on financing; high crime adds heavy security costs to their overheads. A terrible education system makes Brazil the world’s second-hardest place for firms to find the skills they need, according to Manpower Group, behind only ageing Japan. Soaring labour costs, which have doubled in a decade as big hikes to the minimum wage set the tone for pay negotiations across the board, have added a new ingredient to the old recipe.

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“21st century agriculture, 19th century logistics” in Brazil

Mario Osava – Inter Press Service, 04/09/2013

Edson Godinho, a truck driver with 35 years’ experience, was lucky this time. When he reached the southeastern port of Santos in early April, the line of waiting trucks was much shorter than it had been earlier, so he only had to wait 12 hours to unload his soybeans.

In previous weeks, many other truck drivers had had to wait more than 24 hours for access to unloading facilities in this port, where the majority of Brazilian agricultural exports are shipped. For several days the line of trucks was over 20 kilometres long.

Ports are the bottleneck that contributes most to the “logistics blackout” – an inability to cope with increased traffic – predicted for this year of record agricultural production and exports, according to Marcos Jank, a professor at the University of São Paulo who is an expert in this sector.

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Canon sets up shop in Brasil

Anora Mahumudova – The Financial Times BRICS Blog, 06/12/2011

Here’s some much needed good news for Brazil’s ailing manufacturing scene.

Canon, the Japanese camera and optical equipment maker, on Monday announced plans to set up a production factory in the country’s Amazonas state in the northwest. The investment, at ¥210m ($2.6m), is not exactly jaw-dropping. But it is a symbolic vote of confidence in Brazil at a time when investor sentiments are at a low.

Despite the falling demand for consumer credit, which hithero had been fuelling demand for consumer goods, Brazil is still one of the fastest growing markets in the world.

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After-hour e-mail ban swells Brazil cost that business laments

Raymond Colitt – Bloomberg, 01/31/2012

Brazilians tired of answering their boss’s after-hours e-mails may be able to charge overtime based on a law businesses see hurting competitiveness in Latin America’s largest economy.

Using portable communications devices is equivalent to working in the office, according to legislation signed by President Dilma Rousseff last month.

The law is one more obstacle companies say they face in Brazil, where regulations mandating everything from employer- provided breakfasts to union contributions are a daily drag on efficiency bemoaned for decades as the “Custo Brasil,” or Brazil Cost. It takes less time to set up a business in Nigeria or Mongolia than it does Brazil, according to the World Bank, which ranked it No. 126 out of 183 countries in its 2012 competitiveness study.

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