Brazil: In the firing line

Joe Leahy – Financial Times, 9/29/2015

Just under a year ago, Luiz Lima voted in elections to give Brazil’s incumbent president Dilma Rousseff a second four-year term in power. Now, he believes the former Marxist guerrilla should be impeached.

Mr Lima supported Ms Rousseff and her Workers’ party, the PT, because of their emphasis on social programmes. But since her re-election, Latin America’s largest economy has plunged into recession, welfare schemes are under threat from a fiscal squeeze and the PT and its ruling coalition are embroiled in a corruption scandal at state-owned oil company Petrobras regarded as the biggest in Brazil’s history.

For Mr Lima, who has just left a job in Brazil’s stalled civil construction sector, the only way to restore confidence is a change at the nation’s helm. “We have to do something in this regard and it has to be now,” says the graduate from Brazil’s elite University of São Paulo.

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As a boom fades, Brazilians wonder how it all went wrong

Simon Romero – The New York Times, 9/10/2015 

The president of Brazil should have been ecstatic. She had just won re-election after an intense campaign in which she fiercely defended her role in making Brazil, for a few fleeting years, a rising star on the global stage.

But in the days after her victory last October, President Dilma Rousseff was worried, confronted in private deliberations with her closest advisers by signs that Brazil’s triumphs were at risk of coming undone.

“We went too far,” Aloízio Mercadante, Ms. Rousseff’s chief of staff, acknowledged publicly this month, describing the sense of alarm as the dust settled after the election and Ms. Rousseff and her aides grappled with the weaknesses in Brazil’s economy.

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Desperate times, desperate moves

The Economist, 9/5/2015

When a president has single-figure approval ratings, faces calls for her impeachment, and has lost control of her political base, is she in a position to play hardball with the country’s legislators? Brazilians will soon find out.

On August 31st Dilma Rousseff, their president, sent Congress a budget for 2016 with a gaping primary deficit (before interest payments) of 30.5 billion reais ($8 billion), or 0.5% of GDP, challenging its members to close the gap. It was a break with the sound-money practices that have underpinned Brazil’s economy. It was, some critics say, illegal. Certainly nothing similar has happened since at least 2000, when Fernando Henrique Cardoso, then the president, transformed public finances.

On a charitable view, Ms Rousseff was shocking legislators into making hard decisions rather than simply blocking her fiscal proposals. A harsher reading is that she does not know how to lead Brazil out of recession. The markets took that view. The day after the budget bombshell, the Ibovespa stock index fell over 2% and the currency closed at 3.7 per dollar, its lowest since December 2002.  On September 2nd, the central bank held steady a key interest rate it had been raising since last year.

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Thousands in Brazil protest corruption scandal

CBS News – 08/16/2015

Brazilians took to the streets of cities and towns across the country Sunday for anti-government protests being watched as a barometer of discontent with the increasingly unpopular President Dilma Rousseff.

Called mostly by activist groups via social media, the demonstrations assailed Rousseff, whose standing in the polls has plunged amid a snowballing corruption scandal that has embroiled politicians from her Workers’ Party as well as a sputtering economy, a weakening currency and rising inflation.

But the protests drew relatively modest crowds, likely giving the president some breathing room. Huge numbers had come out for two earlier rounds of demonstrations this year.

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Brazil’s president has an approval rating of 8%

Digital Journal – Business Insider, 8/6/2015

Dilma Rousseff is now Brazil’s most unpopular democratically elected president since a military dictatorship ended in 1985, says a poll out Thursday that put her approval rating at eight percent.

Seventy-one percent of those questioned in the Datafolha survey said they disapprove of the way Rousseff is doing her job, up six points since June. Her approval rating is down from 10 percent.

And two-thirds would like to see her impeached.

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Brazil police raid homes of former president and two congressmen


Brazilian police raided the homes of former president and current Senator Fernando Collor and two other sitting congressmen on Tuesday in a sharp escalation of an investigation into corruption at state-owned oil company Petrobras.

Police drive away a Ferrari from the home of Fernando Collor, a former president and sitting senator

Police drive away a Ferrari from the home of Fernando Collor, a former president and sitting senator

As part of the operation, which sparked an angry rebuke from Mr Collor and Senate leader Renan Calheiros, police confiscated a Porsche, Lamborghini and Ferrari that local media pictured being removed from the former president’s house.

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Brazil’s president seeks investment during U.S. visit

Paulo Trevisani – The Wall Street Journal – 6/29/2015

Brazil’s President Dilma Rousseff said Monday that a more business-friendly environment is needed in Latin America’s largest economy to attract the investment it needs to restore growth.

“We need to reduce the risks of doing business in Brazil,” she said in an interview in New York, as she began a visit to the U.S. aimed at drawing investors and to meet with President Barack Obama in Washington.

Her task is complicated by poor economic conditions at home. Annual inflation is running at 8.8% despite high interest rates, with the benchmark rate at 13.75%. Economists forecast an economic contraction this year. But Ms. Rousseff said Brazil still has strong fundamentals that should attract long-term investors.

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