New President Likely To Benefit From Stronger Growth
Jair Bolsonaro has handily beat his more leftist opponent, sending shockwaves to many who had hoped Brazil would turn against a right-wing hardline candidate. Yet Brazilian voters handed the far-right presidential candidate a solid victory in October’s ballot, as the population continued to reject the political status quo.
Bolsonaro’s anti-establishment and anti-corruption stance were decisive for his 10 percentage point victory over former São Paulo mayor Fernando Haddad of the Workers’ Party (PT) amid myriad corruption scandals.
The far-right legislator’s win is part of a broader trend which swept out traditional political leaders from all levels of government. Although Bolsonaro’s once tiny political party, the Social Liberal Party (PSL), will now be the second largest in Brazil’s Lower House, it also means that the new leader will face an even more fragmented legislature than his predecessors.
The new administration has promised an ambitious reform agenda. Although Bolsonaro has offered only vague details of his economic program, his economic team has vowed to prioritize key reforms, notably pension reform. Speaking briefly to the press after securing the victory, Bolsonaro’s chief economic adviser and future Economy Minister Paulo Guedes reiterated the importance of controlling government spending, adding that pension reform would be the top priority. He also promised to speed up privatizations, to “simplify and reduce taxes” and to slowly open up the economy while prioritizing trade outside the Mercosur bloc.