Brazil: Political pressures for the Government in 2012
The Congressional recess ends on February 1st. With the return of activities, controversial issues in the political agenda will require great attention and cooperation by the Executive branch, in order to maintain peace in the relationship with the allied base.
One of these items involves the release of parliamentary amendments. In an electoral year, the topic is highlighted, either because the Congressman has direct interest in the issue or because he needs to help an ally. In 2011, the allied base boycotted some votes to demonstrate their dissatisfaction with the pace of amendment releases. This year the pressure should increase.
Public servants are another source of tension that can extend from the Executive to the Legislative. Workers of the three branches are threatening to strike for wage increases in April. There is also strong resistance between these workers and members of the PT on the bill regulating the Complimentary Social Security Fund for public servants. The date of the vote still hasn’t been decided, but it should happen around February.
Another controversial item is the bill of law, sent to Congress by the Supreme Court in 2009, authorizing an average increase of 56% to 100 thousand employees of the Judiciary. It is estimated that the project, if approved, can generate an impact of R$ 7.5 billion in public coffers.
States and municipalities that are non-producers of oil will continue to fight for the approval of the bill dealing with the distribution of oil royalties. Rio de Janeiro, Espirito Santo and Sao Paulo are the main forces trying to resist the approval. The matter is being discussed by a special committee in the House of Representatives.
Like last year, lawmakers linked to the health sector will plead for more resources. They will insist on approval of the law to ensure the implementation of 10% of net revenue of the Union with health. The government defeated in the Senate bill of law authored by former Senator Tiao Viana (PT-AC) regarding this matter.
Over the year other issues should heat the agenda, such as the renewal of concessions in the electricity sector, the articulations to define alliances and candidates for municipal elections in October, and negotiations around succession for the House of Representatives in 2013.
Despite the occasional problems that these issues can generate for the government, the expectation is that Dilma has the political strength to overcome them smoothly. After all, her government has great public support, the parliamentary base in Congress is significant and projections for the economy are good, despite the international financial crisis. Besides that, the President can always count on the support of former President Lula.
Comment (0)Peru: “We need to focus more on social development and less in military force” says Minister Otarola
The Peruvian government plans to focus more on development than the use of military force to curb drug trafficking in the region, said the new defense minister, Alberto Otarola.
According to Reuters, Otarola said that Peru needs to invest in infrastructure and social programs in the region of the Valley of the Apurimac and Ene Rivers . At least ten soldiers and policemen were killed in the forest region in the last two years in confrontation with drug traffickers and members of the Shining Path terrorist group.
Comment (0)Brazil and Ukraine discusses bilateral partnerships
The foreign ministers of Brazil, Antonio Patriota, and Ukraine, Kostyantyn Gryshchenko, will analyse alliance cooperation on issues such as aerospace, defense, energy and health.
Gryshchenko makes a visit to Brazil, less than three months after the trip to this South American nation of the Ukrainian president, Viktor Yanukovych, which demonstrates the strengthening of strategic links between the two countries, says a press release from Brazilian Foreign Ministry.
Comment (0)Brazil: Three questions to the Minister of Finances, Guido Mantega (made by Época maganize)
Three questions to
the Minister of Finances, Guido Mantega (made by Época maganize)
What is your evaluation of the government’s first year?
We made it through the international economic crisis with relative ease and we met out economic and social targets. We implemented a new model of development, with focus on job generation. Even with a smaller economic growth than in 2010, we created more than 2 million formal jobs. In a moment where the world is full of unemployment, with more than 100 million unemployed people, this is a great accomplishment. Of course, the crisis is not over and is slowing us down.
Don’t you think that the number of ministries and trusted positions is outrageous?
There are ministries who attend to important social issues; for example the Ministry of Racial Equality who focus mainly on reducing prejudice and inequality and the Special Secretariat for Women Policies, which deals with the feminine condition. Both are small ministries.
Do you fell that President Dilma wants to reduce the number of ministries?
President Dilma will maintain the number of ministries.
Comment (0)Brazil: Rejection of the public health situation does not contaminate the popularity of Dilma
Last week, Ibope released a poll, commissioned by the National Industry Confederation (CNI) on the public health situation. The result was highly negative for the government.
According to the survey, 61% of the population considers the public health service to be “very bad” or “bad”; 54% assess the health in their city as “bad” or “very bad”, and 85% said they had not seen improvements in the public health over the last three years.
The main barriers attributed to the public health system were the delay / difficulty to be serviced (55%), lack of equipment / facilities / investments (10%) and lack of doctors (9%).
In addition to the understanding that there is an absence of effective management in public health, corruption is an issue of concern. For 82% of respondents, the government should fight corruption to get more resources to invest in health. For 53%, the waste should be reduced.
The negative public opinion in relation to public health is not new. In recent years, this is an area that has many problems and is evaluated negatively by respondents.
However, it is important to note that such problems did not contaminate the administration of former presidents Fernando Henrique Cardoso and Lula and neither did it stop their reelections. The same goes for President Dilma Rousseff. Despite the negative assessment on health, the president has high approval, according to the latest poll.
Even if the issue of health is important and deserves attention from the Planalto Palace, alone it does not tend to produce shocks in the image of the president and government.
Comment (0)Brazil: Aécio Neves’ leadership questioned once again by the opposition
Once again sectors of the opposition demonstrated ignorance of the political situation today. According to journalist Josias de Souza, of Folha, opposition leaders criticized the performance of Aécio Neves (PSDB-MG) in the Senate.
According to Josias, opinions were heard from five leaders of the opposition (PSDB, DEM and PPS). In their view, Aécio had a lackluster performance in his first year as a senator. The senator’s conciliatory style has also been criticized, as well as the alleged “few trips and speeches”.
The response from Aécio Neves in the form of criticism of his opponents did not take long. He sent a letter to the journalist stating he does not confuse opponents with enemies.
Aécio also defended his performance as senator. He recalled his work on the new proposal for the rite of Provisional Measures (MPs), adopted unanimously, and the debate around the proposed national distribution of iron ore and oil royalties.
More than not understanding the current political scenario, the internal opponents of Aécio Neves demonstrate unfamiliarity with the political style of the strongest opposition name for 2014. Just as in his tenure as Speaker of the House of Representatives, through the government of Minas Gerais and now as senator, Aécio has a conciliatory leadership style quite different from the former governor José Serra, for example. This may help explain the “void” that the opposition feels.
Even if in the next two years, with the closeness of the presidential election, Aécio Neves appears more in the spotlight, harsh criticism of the government should not be part of his strategy. An example is the dialogue that the senator has with the PSB, party of the allied base in Congress. Another important fact to mention is the support of the PSDB for re-election of Mayor Márcio Lacerda (PSB) in Belo Horizonte, situation created by Aécio.
With the opposition still without an alternative discourse and before a government that is very well evaluated, the posture of Aécio Neves in his first year as a senator is not a “disaster”, as some opposition leaders believe. Today, more than worrying about adopting a proactive attitude and criticizing the government, the challenges of Aécio are concentrated, first, within the PSDB, and then with the strategies and alliances needed to attract parties for the design of power he intends to lead in 2014.
Comment (0)Brazil – Dilma and the social movements
The press has run in recent days a series of news stories about the dissatisfaction of social movements with the beginning of the administration of Dilma Rousseff.
The Carta Maior magazine published a balance sheet based on testimony from representatives of three entities – the Central Union of Workers (CUT), the National Students Union (UNE) and the Movement of Landless Workers (MST). For them, the government remained distant from the movements in her first year in office and its posture was often contradictory. According to the entities, if there is no pressure in 2012, many commitments will not leave the drawing board.
The Correio Braziliense newspaper (from 01.13) reported that employees of the Three Branches plan a general strike in April, if the government maintains its unwillingness to increase their salaries in 2012. It was also reported that 17 entities plan to submit in the next 24 days, a list of seven demands, including wage increases.
In 2011, the servers claimed a wage increase equivalent to R$ 40 billion, but the government provided only R$ 1.6 billion.
“The outlook is not good and the signs for Dilma are worse. We will bet on negotiations until exhaustion. If they do not move forward, we will radicalize,” said Josemilton Costa, secretary general of the Confederation of Workers in Federal Public Service (Condsef). to newspaper Valor Econômico,
There is also the expectation of the Red April, sponsored by the MST.
In 2012 it is possible that the former president Lula works to improve the dialogue with social movements.
In particular not to harm the PT in municipal elections and to prevent that the political pressure made by these movements results in the approval of adjustments with which the government disagrees.
Comment (0)Cristina Kirchner opponents try to avoid re-election
Next Sunday (23), the Argentines go to the polls to elect their new president. If no relevant new fact occur this week, the trend is that Cristina Kirchner win re-election in the first round. The favoritism of Kirchnerism over her opponents is so great that it can not be ruled out the possibility of the government to resume its majority in Congress.
As the favorable scenario Cristina is consolidating every day, the government tries to prevent rumors that could jeopardize Kirchnerism the third consecutive victory.
For example, last week, the president’s chief of staff, Anibal Fernandez, denied that the current government has an interest in a constitutional reform that would enable Cristina for a third term in 2015.
Remember that a few days ago, the candidate Elisa Carrio of the Civic Coalition, said the presidential candidate, Hermes Binner also placed second in the polls, would make an agreement with the government in reforming the constitution so that Cristina Kirchner is again a candidate.
In the coming days, the trend is that rumors will show up more often. However, the possibility of them to prevent the re-election of Cristina Kirchner is quite remote. Because of this, the evaluation of Arko Advice, is that the current president is the favorite to win re-election, something that might happen on Sunday, in the first round.
Comment (0)Brazil: Report increases forecast for 2012 budgetary revenue by R$ 29.98 billion
The Revenue Report determines the beginning of voting for the 2012 budget proposal. The proposal, signed by Sen. Acir Gurgactz (PDT/Ro) with the aid of the Revenue Committee, was delivered to the Mixed Budget Committee (CMO) on October 11. It’s voting was scheduled for Wednesday, October 19.
Based on examination of the economic situation, this report seeks to provide the recent evolution of tax collection and behavioral hypotheses for macroeconomic variables, and assess revenue estimates and methodology contained in the 2012 Budget.
It’s worthwhile highlighting that, under the terms of the 2012 Budget Guidelines Law, the Ministry of Planning, Budget and Management must send the eventual update of the economic parameters for 2011 and its projections used to prepare the 2012 Budget Law Bill (PLOA 2012) to the Mixed Budget Committee by November 21. This data may require new revenues assessment for more or for less.
The new forecasts for 2012
The Revenue Report uses various macroeconomic projections for the next year and incorporates, in its revenue projection, the new tax collection numbers published in September, in the Federal Government’s fourth two monthly assessment.
For the large macroeconomic variables, in 2012 the Report forecasts that both GDP growth and the Selic rate (average) will be lower than the PLOA forecasts. On the other hand, the exchange rate and inflation will be higher.
This combination, as indicated in the report, will enable that the drop in revenue, determined by lower GDP growth in real terms, to be compensated by a scenario of greater inflation, as shown by the small variation projected for nominal GDP in 2012.
Furthermore, the Report foresees that inflation for 2012, as measured by IPCA, will reach 6%. This is a very high figure, which goes against monetary authority expectations that there will be a convergence to the center of the target next year.
However, the greatest differentials used by the Report are with regards to the revenue calculation base. Revenue achieved in 2011 has been superior to governmental estimates every month. And, only now in September, when the report pertaining to August was published, did the government recognize that its forecasts for the year were under estimated. Therefore, this perception was not part of the picture that guided the preparation of the budget proposal by the government, which took the accumulated amounts from January to June as a base.
In order to construct a new calculation base, the report is purged of nontypical income that occurred in 2011; it incorporates the effect of already approved legislative changes for various taxes (IPI on cigarettes and beverages), taxation impacts of the new projections on the exchange rate and applies this set of variables to 2011 tax collection, which was recognizably greater.
Another aspect raised by the Report is the difficulty of incorporating the effect of company and employment formalization on the various revenues. This is a phenomenon that has already been happening for various years and was not afforded appropriate treatment up to now. A significant portion of the errors that culminated in tax collection underestimates may have originated from this projection imperfection.
As the fruit of this exercise, the Report concludes that the revenues projected by the government for 2012 are underestimated and proposes a correction.
Comment (0)WTO movements against Brazil
As expected, countries that export cars to Brazil have filed a representation against the new IPI taxation policy on imported cars.
However, two issues intrigue those that understand international trade.
The first is that Japan, the first country to file, chose a committee with little political importance in the WTO. The read seems to indicate that Japan filed just to go through the motions and/or to create a little time in order to arrive at an agreement with Brazil.
The second intriguing aspect is China’s silence in relation to Brazil’s movements. Despite maintaining a significant deficit in its bilateral trade with Brazil, China acts as if it were the favored party.
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