Brazil’s Government Announces New Stimulus Plan

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – Along with his economic team and Congressional representatives, Brazil’s President Michel Temer announced on Thursday a set of ten measures that the government hopes will reverse the country’s worst recession in decades and generate jobs.

Some critics, however, say the measures are not enough and that the government timing is a diversion to the political turmoil spilling into the Temer administration.

“These measures are aimed at boosting the Brazilian economy, at a time when we seek the country’s growth,” President Temer said during the press conference.

Among the microeconomic measures announced on Thursday are new credit lines for small businesses, less bureaucratization for exports and imports and help for companies and individuals in the payment of their debts. According to Temer the measures will improve productivity and lead to growth.

For FGV (Fundação Getulio Vargas) professor Istvan Kasznar, the measures announced are positive start, but many other measures are needed. “It’s time to do this and do more, but we also have not heard how to enable companies to make investments urgently and in this way generate more jobs,” Kasznar told Agencia Brasil.

The president of the Federation of São Paulo industries, Paulo Skaf agrees. “The situation of the Brazilian economy remains very delicate, and there is no doubt that there is no isolated measure that can revive it. The set of measures announced by the government may not solve all problems, but it is a start to stimulate the economy,” read the statement released by Skaf on Thursday.

For some, however, the latest economic measures are a way to shift attention from the ever-increasing political turmoil faced by the Temer administration. In the past week, information revealed by Odebrecht executives to federal prosecutors in the Lava Jato (Carwash) investigations have been leaked to local media.

According to these reports, two of the first executives to be questioned named several politicians linked to the Temer administration in the corruption scandal. In all, 77 executives have agreed to testify about the company’s involvement in bribes to obtain government contracts, including former CEO, Marcelo Odebrecht.

To make matters worse, on Wednesday one of President Temer’s closes aides, José Yunes, handed in his resignation after being named by an Odebrecht executive as receiving part of the R$10 million paid by the company to Temer’s political party, the PMDB.