Connect with us

Economic

The Brazilian Lula can only succeed through pragmatism

Avatar

Published

on

Brazil is back. The words of Luiz Inacio Lula da Silva are an ambitious declaration of intent from one of the most famous leaders in the world yet Notable political resurgence.

Released from prison after corruption convictions were overturned by the Supreme Court, Lula’s narrow election victory last year over far-right incumbent Jair Bolsonaro demonstrated the vitality of the southern hemisphere’s largest democracy and the strength of its institutions.

Fears of mass uprisings Bolsonaristas So far proven to be unfounded. The former captain of the army, who vowed that only God could remove him from the presidency, had gone quietly before Lula’s inauguration on January 1st He was last seen eating fast food in Florida.

Now, 77, Lula inherits a deeply divided, indebted country facing economic headwinds. It is unlikely to benefit from a commodity boom like the one that lifted the economy in its first two periods from 2003 to 2010.

Advertisement

Many of Lula’s early steps were encouraging. His determination to restore Brazil’s reputation as a global environmental leader by stopping deforestation in the Amazon and protecting its indigenous people will be warmly welcomed. So is his commitment to social and racial justice in a deeply unequal country. Few can argue with a pledge to eradicate hunger in one of the world’s largest food producers or to restore professional leadership to key ministries after the chaos of Bolsonaro-era ideologues.

Abroad, Brazil’s status as a developing world power with influence in the West, Russia and China offers diplomatic opportunities. This could be particularly useful in negotiating with Venezuela and Cuba, where the US “maximum pressure” sanctions policy has failed spectacularly.

But Lula’s return was not universally welcomed. Financial markets slumped as investors worried that the veteran left would prove more interventionist and less fiscally responsible than it had hoped. His dismissal of the constitutional spending cap as “stupidity” may be reckless. Pledges to use the state-controlled oil company, Petrobras, and the National Development Bank as engines of economic development are reminiscent of past failures.

The narrow election result showed how many Brazilians still don’t trust Lula’s Workers’ Party. His last term in power ended with Car wash scandal – Biggest corruption case in Latin America ever – Impeachment of President Dilma Rousseff and Brazil’s deepest recession in at least 60 years. The PT needs to show that he has learned from these mistakes.

Navigating a less forgiving economic and political environment, Lula must govern pragmatically and draw on all the talents of the broad coalition that helped him win.

Advertisement

His biggest challenge is getting Brazil back to strong and sustainable growth after a decade of stagnation. This requires bold steps to simplify the tax system, open the economy to trade, improve education and increase investment in infrastructure.

How to fund ambitious campaign promises is an urgent question. Brazil is not a low tax country: the tax burden Close to the OECD average There is little room to borrow more. But there is a waste: Brazil spends more of its national wealth on education than France does, however Results the poor. The answer is better government, not bigger government.

If he wants to reconcile the exigencies of social justice, environmental protection, and sustainable growth, Lula’s best bet is to harness the power of international investment and foreign trade to unleash Brazil’s great economic potential. This would open the way for a truly historic third term.

Source link

Advertisement
Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published.

Economic

UK house prices are falling for the fourth consecutive month

Avatar

Published

on

By

UK house prices fell for the fourth consecutive month as rising borrowing costs hit household finances, according to data published on Friday.

Average home prices fell 1.5 percent between November and December, the mortgage company said Halifax. This decline is a slowdown from the 2.4 percent decline recorded between October and November.

The annual rate of home price growth slowed to 2 percent, down from 4.6 percent in the previous month.

typical Real estate prices in the UK to £281,272 in December, down from £285,425 in November.

Advertisement

“Uncertainty about how the increased cost of living will affect household bills, along with higher interest rates, is causing an overall slowdown in the market,” said Kim Kinnaird, director of Halifax Mortgages.

Mortgage rates, which reflect expectations of medium-term borrowing costs, have risen in the past few months, following a series of interest rate hikes by Bank of England In an effort to tackle high inflation.

Source link

Advertisement
Continue Reading

Economic

Halifax by Reuters: UK house prices post their biggest quarterly decline since 2009

Avatar

Published

on

By


© Reuters. FILE PHOTO: High-rise apartments under construction can be seen in the distance behind a row of apartment blocks in south London, Britain, August 6, 2021. REUTERS/Henry Nicholls

Data issued by the Halifax Mortgage Institution, Friday, showed that house prices in Britain fell again in December, capping the largest quarterly decline since the financial crisis more than 10 years ago.

Halifax said the median home price fell 1.5% month-on-month in December, after falling 2.4% in November, marking the fourth consecutive monthly decline.

On a quarterly basis, home prices fell 2.5% – the largest decline since the three months through February 2009.

“Uncertainty about the extent to which an increase in the cost of living will affect household bills, coupled with higher interest rates, is leading to an overall slowdown in the market,” said Halifax director Kim Kinnaird.

Advertisement

Halifax expects house prices to fall 8% in 2023 – although Kinnaird indicated that this would only mean a return to levels last seen in April 2021.

Home prices soared during the COVID-19 pandemic as people rushed to buy larger homes with gardens, fueled by temporary tax incentives.

Halifax said the annual rate of house price growth fell to 2.0% from 4.6% in November, the lowest reading since October 2019.

“As we enter 2023, the housing market will continue to be affected by the broader economic environment, and with buyers and sellers remaining cautious, we expect a decline in both supply and demand in general,” Kinnaird said.

Source link

Advertisement

Continue Reading

Economic

First: McCarthy is fighting to be Speaker of the House until the fourth day

Avatar

Published

on

By

good morning. This article is an in situ version of our site FirstFT the news. Subscribe to our site AsiaAnd Europe/Africa or The Americas A release to send straight to your inbox every weekday morning

The competition for the next speaker of the US House of Representatives is scheduled to enter the fourth day, after the deputies voted to postpone the procedures yesterday evening after Historic defeat on the eleventh ballot for Republican Kevin McCarthy Amidst a difficult impasse in Washington.

Despite recent trench attempts by McCarthy To quell dissent and secure the votes he needed to be elected president, 20 Republicans voted against him again and again, depriving him of the simple majority needed to win sledgehammer.

The ongoing stalemate has exposed long-simmering tensions in the Republican Party and raised questions about how lawmakers will be able to chart a path forward.

McCarthy resisted calls for him to step down in favor of another Republican, and Democrats objected to suggestions that they might support McCarthy or work with Republicans to choose another president.

Advertisement

1. UK signs cancer trials agreement with BioNTech The UK government is partnering with German Covid-19 vaccine maker BioNTech to enroll up to 10,000 patients in clinical trials in order to Advanced cancer treatments. BioNTech said it would open a research and development center with 75 employees in Cambridge and an office in London, and may later consider investing in UK manufacturing.

2. Create Taiwan’s domestic satellite hero to resist China Taiwan is in talks with a number of domestic and international investors to help its space agency Establishing its own satellite communications provider. Inspired by Elon Musk’s Starlink role in the war in Ukraine, Taipei is stepping up efforts to fortify itself against a potential attack from China.

3. The “social tariff” required in Britain with high energy bills to bear Major energy suppliers and fuel poverty campaigners are urging UK ministers to engage in an ‘open and frank’ dialogue on how to do this. Addressing rising energy costs in the coming yearsespecially for the most vulnerable, as analysts warn that wholesale gas prices may not return to “normal” before 2030.

Line chart of pennies per heat showing average monthly wholesale gas prices during the winter

4. Low inflation is unlikely to deter the ECB from further rate hikes Inflation in the Eurozone probably fell to single digits for the first time in three months in December. However, it is also likely to be a ECB ‘will stick to its hawkish rhetoric’ Prices are rising in the near term, said Franzisca Palmas, chief economist for Europe at research group Capital Economics.

5. China’s new renminbi tactics keep traders guessing The Chinese currency fell by nearly 8 percent last year against the dollar, but Beijing has facilitated this decline by using tools such as the so-called “Invisible reserves” held by state banksinstead of its traditionally harsh intervention by the People’s Bank of China.

How good is it to keep up with the news this week? Take our test.

Advertisement

next day

Putin’s 36-hour ceasefire is set to begin in Ukraine the Ceasefire ordered by Russian President Vladimir Putin Orthodox Christmas is set to begin, despite its refusal by Kyiv, which called it hypocrisy and a propaganda attempt.

Anniversary of the US Capitol attack US President Joe Biden will Giving remarks at the White House On the occasion of the second anniversary of the January 6 uprising. In a final report released at the end of the year, a congressional committee said former President Donald Trump is “central cause” From last year’s attack on the US Capitol. (The Hill, Financial Times)

Eurozone inflation figures In continental Europe, optimism is growing that inflation has peaked. Low inflation in the member states indicates that today’s expected figure at the eurozone level may fall less than expected by 9.7 percent. Read more in our Disrupt Times newsletter.

Returning to its regular January schedule, the World Economic Forum’s 2023 annual meeting will bring together global leaders in Switzerland next week. Join FT Live in Davos for in-person and digital events from 16th to 20th January. View events and register for free here.

What else do we read and watch

Moscow Diaries: Fear, Loathing, and Deep Denial While missiles rain down on Kyiv and villages in Russia’s hinterland, it has lost much of its adult male population to conscription, Putin’s war does not seem to have changed Moscow that much. “Nobody does any self-reflection. What’s the point? If you stop to stop and think about it, it just gets worse,” a Kremlin-linked businessman grumbles to Max Seddon, the Financial Times’ Moscow bureau chief.

Advertisement
New Year's decorations of the Kremlin star bearing the letter Z at the entrance to Gorky Park
New Year’s decorations of the Kremlin star bearing the letter Z at the entrance to Gorky Park © Getty Images

Ruchir Sharma’s Investor’s Guide: From Peak Dollars to Better TV Ruchir Sharma points out that a sudden change in the price of money is a fundamental break with the past, but many business leaders do not act. As this stage progresses, big businessmen, companies, currencies and countries that thrived on easy money will stumble. Make room for new winnerswith a discriminatory provision shaping the trends of 2023.

🎥 Watch: How India can revolutionize women’s cricket The Indian Premier League has transformed cricket from a game struggling for a future into one of the most valuable sporting assets in the world. While the top men’s players have become millionaires, The female players struggled to make ends meet. The launch of a women’s league could change the game around the world.

Premium subscribers can get more sports business by Register on the scoreboard the news.

What happened to Google search? Google search was once one of the wonders of the internet. Writes Eileen Moore. “Clean, orderly results pages navigated the Internet’s unmanageable information load. That was until it was filled with ads.”

How a drug partnership led to a mutation in breast cancer Often medicine does not receive a warm welcome. When Daiichi Sankyo and AstraZeneca announce impressive breast cancer treatment results, Enhertu, Oncologists rose to their feet to applaud. “It was a shocking moment, sending chills down my spine,” said Susan Galbraith, who leads oncology research and development at AstraZeneca.

Take a break from the news

our Six movies to watch this week Including a pouting Tom Hanks in A man called OttoAntonio Banderas as a killer in a classic car port Christian Bale Meet Edgar Allan Poe In Pale blue eye.

Advertisement
Tom Hanks and Mariana Trevino in A Man Called Otto
Tom Hanks and Mariana Treviño in A Man Called Otto © Niko Tavernise

Thank you for reading and remembering that you can Add FirstFT to myFT. You can also choose to receive a FirstFT push notification every morning on the app. Send your recommendations and feedback to firstft@ft.com

asset management – Discover the inside story on the movers and shakers behind a multi-billion dollar industry. Participation here

next week Start each week by reviewing what’s on the agenda. Participation here


Source link

Continue Reading
Advertisement

Trending