Former minister says that the fiscal package presented by the government is “a good proposal”, but that financial agents play a “political game”
Former Finance Minister Guido Mantega said that the fiscal package that reviews public spending is “a good proposal”. According to him, the measures taken by the market are due to a “game” politician.
“The market likes to keep the government in check to get things done. It’s a political game. This political game exists everywhere, so you need to know how to play this game. But the balance [do pacote fiscal] is positive”, he declared in an interview with the portal published this Thursday (5.dec.2024).
Last week by the Minister of Finance, , has an impact of R$ 71.9 billion on public accounts in 2 years and . The package includes an increase in the IRPF (Personal Income Tax) exemption for people who receive up to R$5,000 per month.
For financial market agents, the proposals are “below expectations”.
According to Mantega, Haddad “is being a good minister” and getting “sail this rough sea” competently.
“He talks to Congress, convinces the president [ (PT)] adjustments, even if other ministers are angry about the budget cuts. The problem is that you don’t have money for everything. Managing the State means managing a scarcity of resources. Even in the United States there is a lack of money”, he stated.
“The government is being extraordinary, because it is giving everyone an advantage. But there is unease among the business community with the government, which I think is a contradiction. It’s something that’s hard to understand”, he declared.
Mantega highlighted that “the debt is high”, but that inflation “is relatively well behaved“and the economy”growing above 3% for 3 years”.
He said: “In the past, it was said that if the economy is doing well, with the country at full employment, then the people should be happy. The government is not doing badly. The market says there is a fiscal imbalance, a lack of fiscal control. Does it have? I don’t think so”.
According to the former minister, the BC (Central Bank) “has created negative expectations”, causing “undue pressure” in the Brazilian economy.
The current president of the BC, Roberto Campos Neto, does not have, according to Mantega, “the profile of an independent central banker, a technical”. The former minister declared: “I think he has a political link with the opposition”.
Mantega said “have no doubts” that the BC is responsible for the rise in the dollar. The US currency surpassed R$6 after the announcement of the government’s fiscal package.
“They [integrantes do BC] they let the dollar appreciate and could have carried out currency swap operations [quando a autarquia usa reservas internacionais como uma espécie de seguro para evitar a desvalorização do real]. Everyone does. But they didn’t do their homework regarding the exchange rate”he declared.
“All of this leads me to believe that Roberto’s behavior is not appropriate, it is political behavior. He is the ‘Trojan horse’ of the Bolsonaro government within the Lula government. This situation of rising interest rates will end up interrupting the process of dynamism in the Brazilian economy, which was healthy and ongoing.”, these.
Campos Neto is leaving BC. In January, he will be replaced by Gabriel Galípolo, appointed by Lula.
“Galípolo is a good coach. He is a very intelligent boy, young, but very smart. And I think that my time as executive secretary of Finance was also important because the president of the Central Bank has to be a good macroeconomist”, stated Mantega.
