July 23 2021
1. Crisis leads Centrão to head political negotiations for the federal government
Amid a political crisis – worsening due to accusations made at the COVID parliamentary inquiry (CPI) against the administration, high unemployment rates and increased disapproval in opinion polls – President Jair Bolsonaro decided to replace his Chief of Staff General Luiz Eduardo Ramos with Senator Ciro Nogueira. The Chief of Staff is responsible for negotiating with Congress. Nogueira is one of the leaders of Centrão, the group of parties from the political center that – if sided with the federal government – forms a majority in both the Senate and the Chamber of Deputies.
According to the president, Nogueira’s new position will be made official on Monday. “We will place a senator here as the Chief of Staff, who will be able to establish a better dialogue with the Brazilian legislature,” he said. Bolsonaro also decided to reestablish the Ministry of Labor under a new name: Ministry of Labor and Social Security. Until this change both areas had fallen under the auspices of Economy Minister Paulo Guedes, who said that the change was “natural” and that the direction of the Brazilian economic policy will not be altered.
Valor Econômico: Centrão ganha espaço no governo
Folha de S.Paulo: Ministério da Economia é desmembrado
G1: Bolsonaro tira general e põe senador na Casa Civil
Valor Econômico: Para Guedes, mudança é ‘natural’
2. Defense Minister involved in controversy about printed ballots
Defense Minister General Walter Braga Netto is at the center of a new political controversy. The newspaper “O Estado de S. Paulo” published a story in which the minister is accused of having said to the President of the Chamber of Deputies, Arthur Lira, that if Congress does not approve printing ballots, there will not be an election next year. Braga Netto denies the accusation but said that he is in favor of printing the ballots, something that President Jair Bolsonaro also supports.
According to Braga Netto, the issue will be discussed in Congress. “The discussion on ‘auditable’ electronic votes through a printed document is legitimate, supported by the federal government and currently being analyzed.” Arthur Lira, who is a member of PP – the same party as the incoming Chief of Staff – said that the story is not true. However, the accusation caused a stir among members of congress and government institutions. The opposition is already planning to summon the minister to explain himself. In response to the article, Vice President Hamilton Mourão said that no such threats had been made. “Of course there will be an election. We are not a banana republic,” he said.
O Estado de S. Paulo: General faz ameaça sobre eleição
Folha de S.Paulo: País quer mais transparência, diz ministro
Valor Econômico: Bolsonaro volta a defender projeto
Folha de S.Paulo: Poderes buscam limitar influência militar
3. Study shows record increase in demand for credit in first half of the year
The demand for credit increased 17.3% in the first half of 2021 in comparison to the same period of 2020. According to a study by Serasa Experian, it is the highest increase on record since 2008, when the recording of demand began. Among the sectors of the economy, demand was higher for service companies, with an 18.4% increase, followed by commerce (17.4%) and industry (12.1%). The study indicates that the demand for credit last month in comparison to June 2020 was also significant at 23.2%.
Economist Luiz Rabi, from Serasa Experian, says that the results of the study show how entrepreneurs are strengthening their cash flow after the peak of the pandemic. These companies are more stable and are planning to expand their businesses, especially in the sectors of rural credit, real estate, and vehicles. The increase in demand from micro and small businesses was slightly above the average and reached 23.6% in the first half of the year in comparison to the same period of 2020.
O Estado de S. Paulo: Demanda por crédito bate recorde
4. COVID will impact the global job market for at least 9 years, says World Bank
The World Bank believes that the negative effect of the coronavirus pandemic on the job market and salaries will last for at least nine years in Brazil. According to a report published on Tuesday, the country will go through a “long and significant” decline in formal job rates until it recovers from the economic crisis, just like other Latin American countries. Nearly 14.8 million Brazilians are currently unemployed.
According to the bank’s analysis, even though less qualified workers are the most affected, middle-skill workers will also face the negative effects of the economic crisis. “Even though workers with a higher education do not suffer the effects of a crisis in their salaries, they suffer short term impacts when it comes to jobs. In Brazil and Ecuador, the effects on employment and salaries for middle-skill workers last for nine years after a crisis begins,” states the analysis.
5. Over 50% of São Paulo and Rio Grande do Sul inhabitants receive first dose of vaccine
São Paulo and Rio Grande do Sul were the first Brazilian states to have administered the first dose of the coronavirus vaccine to more than half of their populations. As of yesterday, 53.14% of people who live in the state of São Paulo and 51.02% of people who live in Rio Grande do Sul have received the first dose. Mato Grosso do Sul leads with the highest rate of full vaccination, with 30.39% of its inhabitants having received either both doses or a single dose vaccine.
According to data provided by states, 36.5 million Brazilians are completely vaccinated, representing 17.25% of the population. As of yesterday, the first dose of the vaccine had been given to 44% of Brazilians. Fundação Oswaldo Cruz reported that, in the last few weeks, Brazil has registered a 2.1% drop in the number of daily cases and a 2.6% drop in the number of deaths a day. However, experts warn that the numbers are still high. On average, Brazil sees 39,000 people contaminated with the virus every day and 1,196 deaths. Over 547,000 Brazilians have died since the beginning of the pandemic.