A New Course for Brazil?

Leonardo Pallotta / CC BY 2.0

The upcoming Brazilian elections brought Otaviano Canuto, Senior Adviser on BRICS Economies at The World Bank, Peter Hakim, President Emeritus of the Inter-American Dialogue, João Augusto de Castro Neves, Eurasia Group’s Director of Latin America, and Claudia Trevisan, Washington correspondent for Brazil’s O Estado de Sao Paulo newspaper, to the Inter-American Dialogue to discuss the future of the world’s seventh wealthiest economy. The discussion was moderated by the Dialogue’s Michael Shifter.

The participants were fast to highlight the exceptionally competitive thrill of the Brazilian election. Neves pinpointed key contributing factors including the tragic death of candidate Campos, disappointment with Dilma’s performance, voter fatigue with the Workers’ Party (PT) and the demands of a growing middle class. Trevisan noted that while Marina had initially benefited from this excitement, the hype had passed and Marina was now “losing steam.” “Since the beginning of the month,” Trevisan explained, “Marina has lost support from groups across society--there’s a possibility that Dilma will win.”

But what changed this scenario? Trevisan shed some light on the causes of this volatility discussing Dilma’s successful deconstruction of the “Marina phenomenon.” “Dilma has presented Marina as an unreliable and risky candidate,” explained Trevisan. Voters have consequently flocked back to the PT. Hakim agreed with Trevisan and added that “for voters, protecting what they have is more important than uncertain change.” Despite ailing growth and investors’ discontent, Dilma’s strategic campaign combined with August’s record low unemployment rate of 5% have also allowed her to sustain popular support.

Even though Dilma continues to stand strong in the face of a deteriorating economy, these bleaker growth outlooks do nevertheless call for major policy changes. According to Canuto, challenges will be the same regardless of who wins the October elections. Once in office, the incumbent will have to enact the necessary structural reforms to energize Brazilian productivity growth. Canuto claimed that if Dilma is elected, we can expect change and what he calls a “Dilma 2.0.”

If, according to Canuto, Dilma and Marina’s economic agendas show signs of convergence, what should we expect of their foreign policy? Hakim argued that on foreign relations, “the similarities between the candidates are greater than the differences.” Even though Marina has been more vocal about developing better relations with the US, Hakim argued that when Dilma was first running for president, she sounded very much like Marina does today even though, once in office, she ultimately rebuffed the U.S. on a number of issues.

Come what may in October, the prediction is that Brazil will implement fiscal reforms all the while maintaining its current foreign relations. Amid the forecast of greater ideological fragmentation, it is clear that the election outcome will have a serious effect on the future of Brazilian politics.


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