The Challenges Facing Brazil’s Temer Administration

This week, we continue our two-part series on current political situation in Brazil.  Many thanks to our correspondent, Rodrigo Correia da Silva, for contributing these articles.

The current political scenario in Brazil is quite similar to that of 1992, after the resignation of President Fernando Collor de Mello, when then Vice President, Itamar Franco, assumed the leadership position. Some view this as a positive harbinger for the success of Michel Temer’s interim government to overcome the existing political-institutional and economic crisis.

By User:Jurema Oliveira - http://www.fotosedm.hpg.ig.com.br/, Copyrighted free use

By User:Jurema Oliveira – http://www.fotosedm.hpg.ig.com.br/, Copyrighted free use

The Itamar government was faced with an equal crisis, and it was able to lead the country into a period of economic growth and fiscal and social prosperity.  The Temer government must address a domestic and global downturn in the economy; it needs to overhaul the government, grappling with corruption and cronyism; and it needs to implement realistic and effective austerity measures.  Some of these actions, especially the overhaul of the country’s ministries, discussed in our post last week, are likely to wreak short-term havoc, especially for the regulatory sector.  Temer will need both popular support and the support of the 3 major political parties to succeed.  Ordinary Brazilians, many of whom opposed the large expenditures on hosting the 2015 World Cup and the upcoming Olympics, are hopeful that Temer’s reforms will, indeed, alleviate some of the economic issues they have been confronting.

The main similarity between Itamar and the current Temer government is certainly the economic crisis. During Itamar, Brazil was experiencing a troubled period when hyperinflation was at 1,100 % in 1992, reaching 2,708.55 % the following year, not to mention the total stagnation of the GDP. Temer, too, is facing challenges in the economic arena, while having to overhaul the political system.

Favela Vidigal in Rio de Janiero By Jeff Belmonte - Flickr, CC BY 2.0

Favela Vidigal in Rio de Janiero By Jeff Belmonte – Flickr, CC BY 2.0

It is noteworthy that both Franco and Temer are both members of the Brazilian Democratic Movement Party (PMDB), and the impeachment of Presidents Collor and Dilma were motivated or influenced by allegations of corruption and the inability / unwillingness to work with the National Congress.

At the end of Franco’s term, Brazil was on a path of economic recovery, which earned the country a deserved spot on the international stage.  Now, it is Temer’s turn to push the reforms required to regain the investment-trust of the international community.

To be successful, Temer will have to work closely with the National Congress as well as the members of his administration and cabinet.  His past political experience bodes well for Temer as does the fact that his choices for ministers are experts in their fields as well as politicians.

TransLegal will keep you updated on how the interim government fares.

 

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