Temer: Brazil has returned to growth and the future is bright

Temer: Brazil has returned to growth and the future is bright
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Isabelle Kumar talks to Brazil President Michel Temer. They discuss the country's fragile economic recovery and, of course, his country's longstanding battle against corruption

Brazil has been thrown into political turmoil once again, with former president Lula da Silva losing an appeal against a corruption conviction, dashing his hopes of making a political comeback in the upcoming presidential elections.

Just before that decision was handed down, I spoke to the current president of Brazil, Michel Temer, who’s denied previous accusations that he was involved in a large-scale bribery scandal. We discussed the country’s fragile economic recovery and, of course, his country’s longstanding battle against corruption.

Isabelle Kumar: President, many thanks for joining us on the Global Conversation. Now corruption seems to be endemic in Brazil, you yourself have faced accusations which you have denied as have the past two presidents. But it does beg the question, because this does seem to be an issue that runs from the top down. Why is Brazil so corrupt?

Temer: You know, this issue of corruption is interesting, because the efforts to tackle corruption are the direct result of our constitution.

Corruption allegations come to light very easily and there has been no effort to counter the initiatives to tackle corruption. That is why these references have expanded so much in Brazil. You even referred to alleged allegations of corruption involving myself which I have vehemently rejected.

Brazil was never ground to a halt as a result of the allegations of corruption. Interestingly enough, within a very brief time span, my detractors were unmasked. Actually they are in jail, as we speak. Those who accused me.

Kumar: Does this damage your credibility, as you try and fight allegations? The fact that you have been under suspicion previously in corruption scandals?

Temer: Let me tell you one thing that you and your viewers should know. You probably know that in the last six to seven months, not only have we see more of these misconception that seems to inform your questions – but it corresponds to a period when the country has grown very substantially. Let me share a few facts and figures with you, which you may be aware of. In the past quarter and, as you know, we have been very focused on efforts to overcome unemployment. During this period 1.4 million new job posts were created. In 2016 our GDP was negative -3.3% of the GDP and in 2017 it was already positive. And the forecast for this year, 2018, according to experts is that it will range between 2.5% and 3%.

Kumar: But I hear you. These are issues we will come to, but my question was and it is a very simple question. Do you feel that your credibility is tarnished because of this climate of corruption and the fact that you have faced accusations yourself?

Temer: Oh yes, because of these false misleading allegations, yes. That does somehow affect my honourability. My personal honour is, of course, somehow affected in terms of my personal credibility from a moral perspective, not from a government perspective at all.

Kumar: So you are talking about the economy. We are seeing a modest recovery at the moment. Now there is uncertainty and volatility, particularly in Brazil at the moment. What’s your outlook for 2018? Are you being positive about the outlook or do you have concern about future shocks?

Temer: Very positive outlook, indeed, because the recovery has not been that slow. We are talking about an administration that has been in office for one year and eight months only, not for eight years – So be aware of these facts and figures that I have just shared as they are very revealing. They are saying that we have left the recession behind us in the first eight to nine months and Brazil is now resuming the growth pattern again.

Kumar: You are obviously part of the Mercosur trading block. There is an EU deal there that just seems so near to being grasped. We get the impression, though, that it is running into difficulty at the moment, particularly on the European side. Do you think that trade deal is going to come to fruition?

Temer: If we don’t do it this month, we’ll likely come to an agreement before the end of February and you are right, there has been some resistance from certain European countries, but those sources of resistance are being overcome by the natural effort to engage in a dialogue – and in give and take here and there, both on the European and the Mercosur/Mercosul side. So I think we are soon going to be complete the regional agreement with the EU.

Kumar: We’ve discussed the situation in Brazil in terms of corruption. Obviously in terms of the economy, there’s concern about voter disillusionment. Now obviously this is an election year and we hear of worries of an anti-establishment figure, maybe someone from the extreme right or a populist figure being elected (referring to the candidacy of Jair Bolsonaro) who could reverse the reforms that you are putting in place. Is that something that is worrying you now?

Temer: I wouldn’t say so. You know why? Because the reforms that have been put in place have been so successful so far. So it begs the question, why would a future canditate oppose these current reforms. I mean, think about it. If a presidential candidate wants to criticise the government. He is going to have to say he is against a fall in inflation rates. It used to be 10%, it is currently 2.9%.

He will have to say he is against lowering interest rates, which used to be 14% and are now 7%.

He will also have to say he is against government spending caps because he want to spend freely at his own will, as opposed to spending only as much as he collect by way of revenues.

He will also have to say he’s against all the had work we have done that has led to millions and millions of job posts.

So I am pretty certain that no one can be elected in Brazil without upholding the reforms – that doesn’t mean having populist measures, because past populist measures led us to where we were when I took office. And that is perhaps why there is a certain measure of unpopularity in the case of the incoming president, because our measures are long-term ones.

Kumar: Now you are in the, I suppose, the unfortunate position of being one of the most unpopular presidents in Brazil’s modern history. Why do you think that is and when you look back at your time in office – because you are not going to stand for re-election – tell me in a few words how you felt holding this post of president.

Temer: I will. You know my career as a politician and also as a university professor was very succesful. I will agree with you in that I was somewhat disappointed that, all of a sudden, I found myself being accused of false practices that do somehow affect or did affect my credibility.

But that did not at all prevent me from continuing to work and still enjoying a sense of pride not so much for being the president, but rather for leaving an outstanding legacy for future generations.

So the unpopularity factor does not make me fearful at all, because what really matters to me is the current acknowledgment which is starting to evolve and the future acknowledgment.

Kumar: President, many thanks for being with us.

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