News from Brazil

Brazil Politics & Government News

In Brazil on July 27, 2012 at 10:15 am

POLITICS

President Dilma Rousseff is pessimistic about Brazil’s chances for a meaningful economic recovery this year and is pushing ahead with new measures aimed at lowering taxes and increasing investments, hoping they might give the economy a lift by 2013, government officials told Reuters.

The high cost of doing business in Brazil is a longstanding complaint among, well, pretty much anyone who does business in Brazil. Now the government is trying to chip away at one piece of the so-called Brazil cost: electricity rates that rank among the highest in the world (Bloomberg).

The trial, due to start on August 2nd, of 38 people accused of involvement in Brazil’s biggest corruption scandal of recent years is a rarity. The central accusation in the “mensalão” (big monthly stipend) case is that, after coming to power in 2003, the Workers’ Party (PT) diverted money from the advertising budgets and pension schemes of state-controlled firms to pay off legislators from allied parties, in return for their support. The allegations first surfaced in 2005, and the Supreme Court took on the case in 2007. Only now are the judges ready to try it (The Economist).

Brazil’s civil servants haven’t gotten President Dilma Rousseff’s message. A slowing economy, dwindling tax revenue and falling demand for the country’s commodity exports mean the government must tighten its belt, she argues. But customs workers, university professors and myriad other federal employees are staging strikes across the country, pushing for salary increases worth 92 billion reais ($45.3 billion) (Reuters).

Brazil’s federal tax revenues dropped more than expected in June from the same period a year before, as a stubborn economic slowdown hurts corporate profits and prompts the government to grant tax breaks to some industries (Reuters).

Leonardo Rolim, Brazil’s Secretary of Social Security, said during a press conference in Brasilia that total outflow this year was more than R$100 billion (about $50 billion), the most ever. The value includes Brazil’s base line social security program, known as INSS (R$60 billion) and government employee pensions taking up the rest.  The deficit increased by around R$2.75 billion in June. The total deficit in the social security program is expected to be R$38 billion by year’s end (Forbes).

The Brazilian government questioned as outdated the latest IMF report, released Friday July 20, in which the Fund calls for more domestic savings and greater attention to inflation (MercoPress).

INTERNATIONAL

Brazil’s Foreign Ministry removed nearly all its diplomats from the Brazilian embassy in Syria because of heavy fighting in Damascus. Itamaraty (the Brazilian Foreign Ministry) said in a statement diplomats were moved to Beirut, Lebanon, due to the “deteriorating security situation” (The Rio Times).

Exports from Brazil to countries in Africa have increased five percent year-on-year, totaling US$5.53 billion in the first half of 2012. The figures mean demand from Africa now outstrips that from the Middle East, and the total is also greater than Brazilian exports to Germany and France combined, O Globo newspaper reports (The Rio Times).

Brazil discusses with Chavez arrangements for Venezuela’s Mercosur incorporation. The Venezuelan President met with a committee from the Brazilian government to discuss mechanisms to speed the full integration of the country to the regional block. Brazil currently holds the Mercosur rotating chair (MercoPress).

The Bully from Brazil? South America’s superpower is shoving its weight around across the continent — and the natives aren’t exactly thrilled (Foreign Policy).

President Dilma Rousseff held talks with British Prime Minister David Cameron to pick up some tips on staging the 2016 Olympic Games in Rio de Janeiro (MercoPress).

Brazil’s delegate before the World Trade Organization said he was contacting other members of the organization so that sanctions are imposed on those countries which alter artificial money exchange rates that harm emerging countries (MercoPress).

Brazil’s influential newspaper O Estado de Sao Paulo blasted Brazilian foreign policy and its handling of the Paraguayan political crisis. In an opinion column under the heading “Dilma’s anti-diplomacy” the newspaper argues that the current administration is politicizing foreign policy, the same way that her predecessor, Lula da Silva (MercoPress).

Ambassador to Ghana, Irene Vida Gala announced that Brazil has plans to make available a 96-million-dollar loan facility to boost small-scale and rural farming in Ghana to help increase food production and subsequently improve the country’s bread basket (MercoPress).

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DEFENSE & SECURITY

The Agreement on Cooperation in Defence Field between Angola and Brazil establishes a range of actions, covering areas such as defence, polity, teaching and instruction, military intelligence, military equipment and systems, peacekeeping missions, humanitarian operations, search and rescue operations, among others. The agreement also expects the training of military and technical personnel, implementation and development of programmes and projects for the application of defence technologies, conduction of scientific research and promotion of military training activities (MercoPress).

The process to replace Brazil’s Presidency’s aircraft fleet with new models will be complete in 2013, when the second VH-36 Caracal helicopter will arrive at the Brazilian Air Force’s GTE (Special Transportation Group). The first unit was delivered last week and used by President Dilma Rousseff for the first time two days ago. The model, a VIP version of the medium transportation EC-725 helicopter made by France’s Eurocopter, is part of the delivery schedule established in the Brazil-France military agreement signed in 2009 (Folha).

SOCIAL

In a study The Price of Offshore Revisited, commissioned by the Tax Justice Network (TJN), it was estimated that Brazil’s richest have approximately US$520 billion worth deposited in tax havens. Brazil comes in fourth place only after China (US$1.18 trillion), Russia (US$798 billion) and South Korea (US$779 billion) (The Rio Times).

In 1996, Brazil was the first developing country to commit to free and universal access to the anti-retroviral drugs needed to treat HIV. It has also challenged patents on key treatments to ensure access to cheaper generic medicines. With high-profile safe sex campaigns and free distribution of condoms at events such as carnivals, Brazil was praised for its approach. The World Bank predicted in 1992 that Brazil would have 1.2 million cases by 2000, but in fact the authorities report approximately half that number today (BBC).

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