October 25, 2019


1. Five presidents later, pension reform approved by Bolsonaro

What took over 20 years to be discussed and approved by Congress will now become a constitutional rule. Following eight months of intense negotiations and concessions demanded by legislators, President Bolsonaro achieved what can be considered the biggest win of his presidency thus far. The creation of new rules for pensions in Brazil – a campaign promise – was approved in a final Senate vote and will become law by the end of the year. The reform initially promised by Bolsonaro expected to save R$ 1.2 trillion (USD $299.2 billion) over ten years, but now the administration will have to be content with a smaller sum: R$ 800 billion (USD $199.5 billion) in a decade. According to the amendment, new workers who are now joining the pension system can only retire at 62 (women) and 65 years old (men), both in private companies and the federal public sector, as long as they contribute to the fund for 15 and 20 years, respectively. Read the analysis on the approval of the Pension Reform under the Bolsonaro administration at Brasília Report.

O Estado de S. Paulo: Após mais de 20 anos, nova Previdência é aprovada
Valor Econômico: Veja os principais pontos da Reforma da Previdência
UOL: Confira as regras de transição para quem já é contribuinte

2. Administration speeds up tax and administrative reforms

The administration’s economic team has already started to discuss the possibility of presenting its “post-pension” reform packages to Congress. The package consists of four proposed amendments to the constitution that need to be approved by deputies and senators before taking effect. Of the four proposals, three concern new tax and budget rules. The fourth establishes rules for administrative reform, which would change the work schedule of public servants, reduce the number or public positions to a maximum of 30 from 117 and determine new salary calculations. On Wednesday, Vice President Hamilton Mourão celebrated the victory of the pension reform approval and said they will now focus on new administrative and fiscal rules. “Now we’ll work on other goals – the tax and administrative reforms – the world keeps spinning,” he said.

Folha de S.Paulo: Equipe econômica costura novo pacote de reformas

3. Brazil drops in Doing Business ranking

The World Bank downgraded Brazil by eight positions in the report “Doing Business”, which measures how easy it is to do business across the world. Of 190 countries examined, Brazil is now in 124th place, dropping from 116th last year. The downgrade puts Brazil in the same position it was in 2017 and indicates that the administration has to work harder to make it easier for people to do business in the country. It also shows that Economy Minister Paulo Guedes is far from achieving his promise to have the country among the top 50 on the list by 2022, when Jair Bolsonaro finishes his first mandate. Countries like Uganda and Egypt have already surpassed Brazil on the ranking. The economy team said they plan to question some of the criteria for the ranking. Despite the downgrade, the World Bank is positive about Brazil, given less bureaucracy for registering properties and companies, among other points.

Valor Econômico: Brasil cai no ranking de facilitação de negócios

4. In a new political maneuver, Bolsonaro’s son becomes PSL leader

Four days after failing to replace Delegado Waldir as the leader of Partido Social Liberal (Social Liberal Party, PSL) in the Chamber of Deputies, Congressional groups in support President Jair Bolsonaro managed to put his son – Eduardo Bolsonaro – into the position. On Monday, as soon as he took over, Eduardo demoted the party’s 12 vice leaders. Allies of party president Luciano Bivar saw the manoeuvre as a betrayal by the presidential family. According to the demoted group, they had made a deal with the administration: Delegado Waldir would resign and they would find common ground. However, this is not what happened. Members of Congress who support Eduardo obtained enough signatures to make him party leader. “Here we are all politicians. Politicians don’t do what they want. Politicians are the art of the possible,” said Eduardo, who denied there was ever any deal. The conflict within the party is ongoing and members have filed a disciplinary complaint against Eduardo and 18 other deputies. However, a provisional decision by the Justice Department dismissed the complaint.

Folha de S.Paulo: Em reviravolta, filho de Bolsonaro assume liderança do PSL
O Estado de S. Paulo: Eduardo degola partido e PSL tenta degolar Eduardo

5. 4.5 million Brazilians choose to work from home

Around 4.5 million Brazilians use their home as their workplace, according to IDados, based on research by the Brazilian Institute for Geography and Statistics. Since the first quarter of the year, 1.2 million people have entered this category of work. This is due in part to the long-lasting crisis in the job market – which means that there are fewer full-time jobs available. Technology has also brought possibilities, as it cuts costs for transportation, food and time. According to IDados, only 1.1% of the people who work from home are properly registered and have full worker’s rights, indicating that there was an increase in informal employment. The study also shows that there are now lower salary ranges. Half of the people working from home earn less than half of the minimum wage and have less formal education (27.1%). At the same time, the number of people who completed higher education and are now working from home is also increasing: from 16.3% at the start of 2018 to 19.3% in the second quarter of 2019.

O Globo: Cresce o número pessoas que trabalham em casa

Brasilia Report

Click here for the Brasilia Report, a weekly analysis prepared by JeffreyGroup Senior Advisor in Brasilia, Gustavo Krieger.