February 28, 2020
1. Stocks plummet after coronavirus case confirmed
The financial market reopened under the pall of the confirmation of the first coronavirus case in Brazil. The Brazilian Stock Exchange plummeted 7% on Wednesday and has continued to drop since. Stocks in other countries also plummeted during Carnival and the drop in the Brazilian market was expected. Regarding market value, companies listed in the Ibovespa index lost over R$ 260 million (USD $57.7 million), the worst performance capital market performance since May 18th, 2017. The price of the U.S. dollar continued to rise. On Thursday, it reached R$ 4.483. This morning (Friday), it opened at a price of R$ 4.50. The impact of the first case of coronavirus is a bigger concern for the economic team than the political turmoil and the relationship between Jair Bolsonaro and Congress. The international situation worsened over the past two weeks, forcing technicians to revise expectations for economic activity. Yesterday, National Treasury Secretary Mansueto Almeida said that the virus might affect global growth, so it is necessary to wait and see how it will affect Brazil. “If we see a big drop in growth projections across the world, this will also affect Brazil,” he said.
Valor Econômico: Chegada do coronavírus derruba bolsa
Folha de S.Paulo: Dólar dispara e atinge R$ 4,50
Folha de S.Paulo: Doença pode impactar crescimento brasileiro, diz secretário
2. Government monitoring cases and moves up flu vaccinations
The first confirmed case of coronavirus in Brazil was diagnosed in a patient who returned to Brazil from Italy. Other suspicious cases are currently being analyzed by Brazilian health authorities. Even though the mortality rate of the virus is low when compared to other international outbreaks, the issue continues to capture the media landscape and has left the country on high alert. The Ministry of Health announced that it will move flu vaccinations forward to March 23rd. This immunization will help reduce the number of cases of the common flu and strengthen people’s immunity, as well as giving doctors more certainty when diagnosing patients suspected of having contracted the coronavirus, which has similar symptoms. Socorro Gross, the head of the World Health Organization in Brazil, said there is no reason for panic. “The virus is not new. We know more about it than we do about other viruses, we have more information and research on it,” she says. Physician and Health Minister Luiz Henrique Mandetta asked for people to remain calm, pay attention to hygiene and search for trustworthy sources of information. “If we take into consideration the number of people who die from tuberculosis every year, it is over one million. Last year in Brazil, there was a dengue fever epidemic with 700 people dead. We had deaths due to measles. However, this doesn’t provoke the same panic reaction,” he said. The new strain of coronavirus has infected over 83,000 people and has killed at least 2,800 in 57 countries and territories.
O Globo: Governo avalia casos suspeitos e antecipa vacina contra a gripe
Folha de S.Paulo: Se repetir cenário da China, coronavírus é administrável no país
O Globo: OMS diz que não há motivo para pânico no Brasil
Folha de S.Paulo: Veja o que já se sabe sobre novo coronavírus
3. Bolsonaro endorses protest against Federal Supreme Court and Congress, backs down
The relationship between President Jair Bolsonaro, the Federal Supreme Court and Congress has deteriorated further. Bolsonaro shared a video on a WhatsApp group calling for a protest against the Judicial and Legislative powers scheduled for March 15th. The video endorses a statement made by the Secretary of Institutional Security – General Augusto Heleno – who said that members of Congress blackmail the administration to use the federal budget in their favor. Following the backlash over this statement, the president said he was under attack from the press due to a personal conversation. Yesterday, his tone changed. The president said that the video was made in 2015. However, the piece features images from when Bolsonaro was stabbed, in 2018. Justice Celso de Mello, who has been in the Federal Supreme Court the longest, had one of the strongest reactions against the president. According to him, Bolsonaro’s action “reveals a perspective unworthy of someone in the high position he holds” and “represents contempt” towards democracy. The presidents of the Senate and of the Chamber of Deputies have also criticized the president. Officially, Bolsonaro forbade his ministers from endorsing the protest. However, the administration now fears that members of Congress will vote against them on strategic issues.
Folha de S.Paulo: Bolsonaro cobra votações e nega ter incitado protestos
O Estado de S. Paulo: Equipe econômica teme crise e pautas-bomba
Valor Econômico: Organizadores de ato valorizam visão militar
Folha de S.Paulo: ‘Presidente não pode tudo’, afirma ministro do STF
4. President’s party says it won’t run in this year’s election
This week, Aliança pelo Brasil (Alliance for Brazil) – the party President Jair Bolsonaro plans to make official – said it is very unlikely that they will be approved in time for this year’s election. As of Wednesday, the Federal Supreme Court had registered less than 20% of the 492,000 signatures needed to officially create the party. According to Aliança pelo Brasil, over 1 million signatures have been collected, but electoral notaries have not recognized them. Due to this, lawyer and second vice president of the party, Luís Felipe Belmonte dos Santos, said there is no hurry to officialize the party now. “The president is not thinking about the next election, but about the next generation. He doesn’t want quantity. He wants quality. He wants trustworthy people in order to avoid what happened with PSL,” he said, mentioning the party for which Bolsonaro was elected and which he left in November.
5. The elderly raises public health expenses by R$ 50.7 billion
The ageing population of Brazil will require an additional R$ 50.7 billion (USD $11.3 billion) in public health expenditure through 2027, according to Secretariat of National Treasury estimates. According to a demographic impact study, in 2027 alone the government could spend an additional R$ 10.6 billion (USD $10.4 billion). This year, the federal budget for health is R$ 135 billion (USD $30 billion). The elderly population, measured by the Brazilian Institute of Geography and Statistics (IBGE), will continue to grow rapidly. In 2018, people aged 65 years or older represented 10.5% of the population. In 2027, according to IBGE this group could represent 12.35% of the total. Estimating the effect of this demographic development on health expenses, the administration has considered highly complex pharmaceutical and medical care in clinics and hospitals.