Good point about Dilma being Lula's autopilot. 56% of the vote gives her a pretty strong mandate, which she shouldnt scrap. IMO the economic boom from the Lula times could be tricky for her. The initial joy from the influx of capitals has changed for worries because this was one of the factors that raised the Real to its highest levels for the last couple of years. That episode in whats known as the "currency warfare" is largely perceived as damaging for the Brasilian exporters.
Another thing is the ineffective state expenses that are bound to eat some of these investments. And she'll need that money for upgrading the infrastructure. Currently the roads are in a terrible condition, and transportation hubs like airports and sea ports cannot meet the demand. Furthermore, if the state banks keep giving out loans with the current tempo the inflation could fly out of control. This is an area Dilma should be extremely careful. Presently the credit interest in brasil is 10.75% which is one of the highest in the world and double the sie of the other developing countries like Russia, India, China (with whom Brasil forms the BRIC group).
Its again the economy, stupid. And Dilma was smart enough to declare in the very first day after her victory that the fiscal policy would be her priority, along with two other priorities - curbing poverty like you said, and keeping economic stability, along with achieving gender equality.
Prolly her first challenge of all would be to craft new legislation that'd simplify the extremely complicated tax system which is endemic for the region. But La Presidenta will surely manage to pass this law since she now has an even bigger support in Congress than even Lula at his time. And though she vowed to keep state expenses under control she has already dismissed the possibility of drastic budget cuts.
As far as i'm able to gather for the time being, her first priorities are: * Keeping budget deficit below 3.3% of the BNP, while the net debt should drop to 30% of BNP by the end of 2014 (its 41% now). * Bigger role of the government in strategic sectors like banking, petrol and energy. She's continuing Lula's policy of strict state control over newly discovered oil deposits. * Structural reform - easening the tax system, harmonising the tax levels between al states, and macroeconomic reforms. Partial reform of the pension system (are you lis'nin, Sarkozy?) Dilma refused to bring the working week down from 44 to 40 hrs, but she also made it cleare she won't touch the generous bonuses for the workers, which according to the business decreases Brasil's attractiveness as a labour destination. * Continuity in all now existing foreign policies.
Guys to watch for the new gubmint: Antonio Palossi, Luciano Coutinho, Paolo Bernardo, Guido Mantega, Enrique Meirelles, Alexandre Tombini, etc.
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Date: 2/11/10 20:10 (UTC)Another thing is the ineffective state expenses that are bound to eat some of these investments. And she'll need that money for upgrading the infrastructure. Currently the roads are in a terrible condition, and transportation hubs like airports and sea ports cannot meet the demand. Furthermore, if the state banks keep giving out loans with the current tempo the inflation could fly out of control. This is an area Dilma should be extremely careful. Presently the credit interest in brasil is 10.75% which is one of the highest in the world and double the sie of the other developing countries like Russia, India, China (with whom Brasil forms the BRIC group).
Its again the economy, stupid. And Dilma was smart enough to declare in the very first day after her victory that the fiscal policy would be her priority, along with two other priorities - curbing poverty like you said, and keeping economic stability, along with achieving gender equality.
Prolly her first challenge of all would be to craft new legislation that'd simplify the extremely complicated tax system which is endemic for the region. But La Presidenta will surely manage to pass this law since she now has an even bigger support in Congress than even Lula at his time. And though she vowed to keep state expenses under control she has already dismissed the possibility of drastic budget cuts.
As far as i'm able to gather for the time being, her first priorities are:
* Keeping budget deficit below 3.3% of the BNP, while the net debt should drop to 30% of BNP by the end of 2014 (its 41% now).
* Bigger role of the government in strategic sectors like banking, petrol and energy. She's continuing Lula's policy of strict state control over newly discovered oil deposits.
* Structural reform - easening the tax system, harmonising the tax levels between al states, and macroeconomic reforms. Partial reform of the pension system (are you lis'nin, Sarkozy?) Dilma refused to bring the working week down from 44 to 40 hrs, but she also made it cleare she won't touch the generous bonuses for the workers, which according to the business decreases Brasil's attractiveness as a labour destination.
* Continuity in all now existing foreign policies.
Guys to watch for the new gubmint: Antonio Palossi, Luciano Coutinho, Paolo Bernardo, Guido Mantega, Enrique Meirelles, Alexandre Tombini, etc.