Brazil’s presumptive president beset by risks

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BRASÍLIA: Michel Temer expects to become Brazil’s full president if his rival Dilma Rousseff gets impeached this week. If he trips up, the country will fall deeper into crisis, analysts warn.

Here are some of the economic, political, social and legal challenges facing him if he secures the job of dragging Latin America’s biggest economy out of recession.

Political minefield    
Center-right PMDB party leader Temer, 75, was leftist Rousseff’s vice-president and stepped up to replace her during the impeachment process.

The Senate is widely expected to vote to remove her from office next week. Temer would then have to avoid Rousseff’s fate of falling prey to internal political divisions.


“Temer is supported by conservative sectors and saw an opportunity to become president. But he has a conciliatory style,” said Roberto Requiao, a PMDB senator who opposes the impeachment.

Temer is planning business-friendly economic reforms but Requiao said he is not as economically liberal on certain issues as some of his right-wing allies.

“If he does not carry out that radical program, he will not resist the demands of those conservative groups. And if he does, another crisis will break out.”

Economic storm         
Brazil is suffering its worst recession in decades. Temer has vowed to cut spending and push through controversial labor and pension reforms.

But to do so, he will need to push constitutional reforms through Congress.

“Now he has to prove what he can do. The level of public spending is unsustainable and there is no way to solve it without reforms,” said Carlos Kawall, an economist and former head of the Brazilian treasury.

“The key is structural changes. If he doesn’t achieve them, we will enter an even deeper crisis.”

Social protests    
With his all-male, all-white cabinet, Temer is seen as an establishment figure.

Rousseff’s Workers’ Party (PT) is fighting to mobilize unions and protest groups in its favor, defending its record of generous welfare spending.

“Economic cuts will mean less funding for the social movements that were very close to power under the PT governments. Now they may regroup,” said Luiz Alberto de Souza, a sociologist at Candido Mendes University in Rio de Janeiro.

Kawall added: “When there are reforms, the labor unions will mobilize.”

Corruption stain
Senior figures in Temer’s political camp, as well as Rousseff’s, are implicated in a scandal over corruption in state oil firm Petrobras.

Three of the ministers in Temer’s interim government resigned after being implicated. Some suspects mentioned Temer’s own name in plea bargains.

He is not being formally investigated in the case, though separately the courts are probing allegations of campaign finance irregularities against him.

“The government has no margin for error. They have to be very, very careful,” said Ramon Aracena, chief economist for Latin America at the Institute of International Finance.

“The Petrobras corruption scandal is still lingering. That’s a risk.”

AFP

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