Transitioning President-elect Luiz Inácio Lula da Silva added a team of economists on Tuesday that includes at least two members likely to allay market concerns about potential trade and financial policies the new left-wing leader might consider.
Investors look favorably on André Lara Resende and Pérsio Arida, conservative economists who were among the architects of the Real Plan in the 1990s that implemented a new Brazilian currency and brought hyperinflation under control.
The other two economists on the transition team are Nelson Barbosa, who was finance minister under President Dilma Rousseff of da Silva’s Workers’ Party, and Guilherme Mello, an economics professor long known as the Party’s economist. workers.
“They don’t have opposing views. They are complementary,” Vice President-elect Geraldo Alckmin told reporters during the announcement in the capital, Brasilia.
Alckmin said those involved in the transition will not necessarily join the administration after da Silva is inaugurated on Jan. 1 for his third term as president — he also held the post in 2003-2010.
Still, those chosen to work in the transition give an idea of how da Silva, who is universally known to Brazilians as Lula, intends to conduct economic policy.
His first two terms coincided with a surge in demand for commodities that helped spur a Brazilian economic boom and fill government tax coffers. This time da Silva will face a more unfavorable global economy, fierce political opposition and limited room to maneuver with a stretched government budget.
One of the most pressing challenges is to deliver on its promise to maintain a broad social protection program and increase spending on health and education without exceeding a constitutionally mandated spending cap. It must also reinvigorate an economy that has seen weak growth or declines for most of the past decade.
“Lula understood that he needed to have a much wider range of forces than just the centre-left,” said Eduardo Grin, political analyst at the Getulio Vargas Foundation in Sao Paulo. “Lula wants differing opinions to make his own decisions.”
In recent days, da Silva’s transition team had proposed several names for economic coordinators that have raised concerns in financial markets.
One was Fernando Haddad, a former mayor of Sao Paulo and former presidential candidate with an academic background as a law professor who has never worked on economic issues.
The other, Guido Mantega, was finance minister under da Silva and under Rousseff and is considered by many critics to be responsible for Rousseff’s economic measures that led Brazil into a financial crisis.
Although Mantega will not be part of the economic team, he will work in the transition in another area, Alckmin said, without giving details.
