Dilma Rousseff & Brazil’s Economic Uncertainty

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Dilma Rousseff is one of the most charismatic leaders to have come out of Latin America but that is not what everybody would like to think

Brazilians, overwhelmingly, reject Dilma Rousseff. As the President of Brazil, she is fast becoming the target of criminal charges, that seems to have no solid ground to stand upon but was nonetheless pressed into reality by Eduardo Cunha, the lower house of Congress’ Speaker. This is happening as political evidence points towards her term coming with excessive spending, bad management skills, huge unemployment figures, and a bad-performing economy – all of this is only in Dilma’s first term. In her second term, Congress ran out of her control, and no news really about much needed fiscal reforms and spending cuts to help Brazil’s economy. A troubled economy is feeding into the perception that the public have of Dilma and it is obviously a very unfavourable one, as notices file up about her hiding the full extent of government misspending. In Brazil’s recent history, Dilma can be looked at as a defective President: the criminal charges pressed against her might have been motivated by bitter vengeance, but the fact remains that unpleasant political derivatives in Brazil because of Dilma needs sound justice.

This year is meant to be about hosting the Olympic Games for Brazil, the first country in South America, to have received this honour. Amidst preparations for a national party atmosphere, is the looming thought about the country’s political hardships. The state debt scale has been reduced to junk status, the finance minister quit prematurely in hopelessness, and the economy is expected to be slashed by around 2.5percent to 3percent this year, which is topping up the same amount for last year. Brazil cannot be an emerging economy in distress because it is a part of BRICS (B) and that status is indicative of it being an economy that can be classified as a rapidly growing one (in size), like Russia, China, India and South Africa. The catalyst of the problems in Brazil now can be traced back to excessive spending to fork out pensions and a tax relief for industries on the hotbed for favouritism, and now the only solution within sight seems to be the increment of taxes and alienating the thought of too much spending.

With a new finance minister at the helm, Dilma should move towards securing a more stable pensions system because right now, Japan, a richer state than Brazil, shelves less for pensions. In Brazil, on average, women retire at the ago of 50, and men retire at the age of 55, and the national minimum wage, as now, cannot be at the same level as the expected pensions rate, if Brazil is to smoothly expand economically. Furthermore, labour laws have fenced in expensive firing for workers who can never do their job right, slim international competition inside of Brazil is thinning productivity, and most of public spending is secure from cuts because of a cause for celebration back in 1988 over the termination of military rule, which made it possible to grant security over jobs, as well as national advantages. The good news is that borrowing, for the most part has been in the national currency, so there is no fear of defaulting, but there is a great fear of inflation because of a mountain of debts. Inflation can happen if Brazil’s government cannot transform the national climate, so that means a possibility of more poverty again, or at least no economic progress, and a political way forward is historically much more sound for Brazil.

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