The impeachment of Brazil’s Dilma Rousseff marks the start of a new era for the country ending 13 years of leftist Workers Party rule. So what does it mean for Brazil, its people and its struggling economy?
Risk analyst Carlos Cardenas from IHS Global Insight spoke with Euronews reporter Damon Embling.
Embling: This impeachment has obviously come as no surprise, how much of a turning point do you think it is for Brazil?
Cardenas, Analyst, IHS Global Insight: It closes a chapter now, it closes a period of uncertainty regarding who will lead the country. Another main priority for President (Michel) Temer would be to not only re-unify the country, re-unify all of the political parties that are part of the Congress in Brazil, but also the main challenge would be the economy.
He has a very uphill battle. The economy is in recession, three percent of GDP this year, and the fiscal deficit is widening, 10 percent of GDP, inflation is high and unemployment is also out of control. It would be a very difficult challenge that he faces now, over the next years.
Embling: so the turmoil certainly isn’t over yet then?
Cardenas: No, that is not the case. Temer is a pro business politician and he has promised a lot of things that the private sector likes to hear, like privatisation, like structural reforms. But we believe he has a very short time frame and that it will be very difficult for him to manage to get approval of key reforms that he has promised, particularly pensions, labour reforms and more or less the only short term strategy that he will pursue will be the privatisation of some assets that the state currently owns. But even that will face high opposition from the powerful unions in Brazil.
He will have the momentum, now after the impeachment. But now immediately in October, we will have municipal elections. No political parties are going to try and gain votes by opposing unpopular measures like austerity programmes like are being proposed.