October 18, 2019
1. Called a ‘jerk’ by party leader, Bolsonaro confronts PSL
The crisis between Jair Bolsonaro and the national president of PSL, Luciano Bivar, affected Congress and made it clear how the Bolsonaro family struggles to deal with members of the party within the Legislative body. Bolsonaro has criticized Bivar and worked to remove him as party president. PSL is the second largest party in the Chamber of Deputies following Bolsonaro’s election. Bivar has been the target of a Federal Police operation searching for evidence of embezzlement of public funds to electoral campaigns. Amid this political turmoil, Bolsonaro announced that he plans to leave the party, but he wants to take between 20 to 53 elected members of Congress with him. Things got heated yesterday after Bolsonaro was recorded asking for support to remove Delegado Waldir as party leader in the Chamber of Deputies and put his son Eduardo in his place. Bolsonaro’s supporters didn’t get enough votes. Delegado Waldir was also recorded – without his knowledge – expressing his annoyance by saying that he would “implode the president.” “I walked under the sun in over 246 cities in support of this jerk’s name.” The conflict doesn’t stop there. Joice Hasselmann, who was the Leader of Government in Congress, did not support the move in favor of the President’s son and was removed from the position by order of Bolsonaro. Amid all of this, Eduardo’s future as ambassador to the US is uncertain. Among PSL members who are against Bolsonaro, two things are clear: Eduardo and Flávio Bolsonaro will be removed as presidents of the party’s state offices in São Paulo and Rio de Janeiro respectively. Read the analysis of the power of the Bolsonaro family in the Brasília Report.
Folha de S.Paulo: Crise do PSL chega ao Congresso
O Estado de S. Paulo: Líder do PSL ameaça Bolsonaro e o chama de vagabundo
Folha de S.Paulo: Dissidentes tentam por filho de Bolsonaro na liderança do PSL
O Estado de S. Paulo: Bolsonaro destitui líder do Governo no Senado
O Estado de S. Paulo: Entenda o racha no partido do presidente Bolsonaro
2. Brazil ‘needs to do more to grow’, says IMF report
This week, the International Monetary Fund (IMF) released a report in which it says that Brazil “needs to do more to grow.” The international body reduced its growth expectations for Brazil’s Gross Domestic Product (GDP) from 2.4% to 2% next year. It is one of the lowest expectations in Latin America. However, despite the growth being below expectations for 2020, the IMF increased the expectations for growth this year, going from 0.8% in July to 0.9% now. According to IMF’s chief economist Gita Gopinath, the Brazilian economy “registered some recovery” and improvement of indexes, but political uncertainty surrounding the Pension Reform shows that “more needs to be done.” “We hope that, with more reforms, the outlook improves,” she said in an interview in Washington.
Folha de S.Paulo: ‘É preciso fazer mais para crescer’, diz FMI
3. Reform covers less than 20% of Pension deficit
The Pension Reform bill that is still valid – as it is being analyzed by the Senate – would generate savings that wouldn’t cover 20% of the pension deficit. The deficit is caused by payments of pensions and other benefits guaranteed by the law. An assessment by the Federal Court of Accounts (TCU) reveals that the country needs at least R$ 5.1 trillion (USD$ 1.23 trillion) to even out expenses with the Social Pension from 2020 to 2029. The bill in the Senate, however, expects just R$ 800.3 billion (USD$193.57 billion) in savings. When proposed by Economy Minister Paulo Guedes, the Pension Reform would reduce government expenses by R$ 1.2 trillion (USD$ 290 billion). The Senate is expected to vote on the bill next week. After promulgation, the new rules will be in effect in the country.
Folha de S.Paulo: Reforma cobre menos de 20% do déficit da Previdência
Valor Econômico: Cresce número de aposentados e pensionistas
4. Income inequality grows to a record number in Brazil
The income inequality registered in Brazil last year was the highest ever recorded since the Brazilian Institute of Geography and Statistics began to collect this sort of data. According to the institute, 40% of Brazil’s entire revenue is in the hands of just 10% of the people. When looking at different sectors of the population, people who didn’t finish high school earn an average of R$ 1,227 (USD$297) a month, half of what most of Brazilians get paid. Women are also disadvantaged according to IBGE – they are paid 20% less than men to do the same job. The study, published this week, also shows that the people in the bottom 5% got paid 3% less, while the richest – representing 1% of the population – earned 8% more.
5. Women increase company revenues, study shows
A study by S&P Global Market Intelligence reveals that companies have better financial results when the financial executive board is led by women. The study was published earlier this week. Companies that have women in charge of their financial department had a 6% higher revenue over 24 months than companies in which men are responsible for the finances. The stock prices of the companies were also different. Female executives generated US$ 1.8 trillion in accumulated profit for the companies. Researchers analyzed data from 6,000 companies on the Russell 3000 index from the past 17 years. According to S&P’s research director, Daniel Sandberg, one of the reasons that might have resulted in better female performance is that the market is more demanding towards women.
Valor Econômico: Mulheres geram US$ 1,8 tri a mais de lucro
Click here for the Brasilia Report, a weekly analysis prepared by JeffreyGroup Senior Advisor in Brasilia, Gustavo Krieger.