Brazil Bolsonaro says Economy Minister will remain until the end of his term: “We will leave together”

RIO DE JANEIRO, BRAZIL – Bolsonaro challenged the Federal Supreme Court (STF) and guaranteed Guedes’ permanence until the end of his term. “We will leave together, up ahead, you can be sure of that,” the President said.

Visiting a bird breeders’ event in Brasilia, Guedes also again advocated Petrobras’ move to the stock exchange’s “Novo Mercado” (New Market) and stressed that the state-owned company could change “from poison to a vaccine” for the Brazilian economy.

The Minister stated that Bolsonaro “is not populist” but rather “popular” and that it would be much easier for the President to decree a state of public calamity and create a new “war budget” to expand aid to the poorest.

“The redrafting of the cap is technically correct, but it is clear that they are going to say that it is opportunism. It would be easier for him to decree a state of calamity due to the impact of the pandemic on the poor and create a parallel budget,” the Minister said.

Bolsonaro challenged the Federal Supreme Court on the lawsuit in which he calls for the establishment of a single rate of ICMS tax on fuel. “The way ICMS is calculated is unfair; I lament the Supreme Court’s delay,” the President said.

He also stated that a new fuel readjustment should happen soon and assured that he will not interfere in Petrobras’ pricing policy. “We will not interfere in the price of anything. That has been done in the past and it didn’t work out,” the President said.

Consequently, he added that the government is working to enable a monthly aid for truckers, in the amount of R$400 (US$71). “We know it’s not much, and it will be done within the fiscal responsibility limit.”

The Minister of Economy – who saw part of his team leave last week in protest against breaching the cap – lowered the grade he himself had assigned to the management of public accounts. “Better to take 8 or 7 and prioritize the most vulnerable Brazilians,” he said.

Guedes also attacked economists who criticized the breach of the spending cap, with emphasis on his predecessor in office, Henrique Meirelles, responsible for creating the fiscal anchor. “Meirelles is a candidate and is available to any government. He built the cap and ran,” the Minister accused.

Guedes also nominally attacked economists Maílson da Nóbrega and Afonso Celso Pastore, who criticized the cap breach. “Maílson criticized the change in the cap and led the country to 5,000% inflation,” Guedes said, before adding that Pastore allegedly served the dictatorship and “delivered nothing.”

Pointed out as a pre-candidate to the Planalto in 2022, Senate leader Pacheco was also targeted. Guedes blamed the Senate for the delay in analyzing the income tax reform, which according to Guedes would create the source of revenue needed for the “Auxílio Brasil” (Brazil Aid) within the cap. “He needs to advance reforms to defend his own candidacy,” Guedes challenged.

The Minister further said he has received information from the Federal Treasury that the country is raising record revenues and projected growth of over 5% for this year’s GDP. “This idea that Brazil will not grow is a political narrative,” he said.

On Petrobras, Guedes said that the state-owned company could yield up to R$150 billion by going to the New Market, which would mean restricting capital to only one class of shareholders, among other aspects.

“There was much stealing at Petrobras and at the same time, the price (of shares) keeps going up. If we go to the New Market, we will generate between R$100 billion and R$150 billion of wealth. We have the tool, the important thing is to maintain the reforms,” the Minister concluded.