Foreign investment, co-op within BRICS key for economic upturn of Brazil

As Michel Temer was sworn in as Acting President of Brazil on May 12, he faced the worst economic recession in decades, with unemployment, inflation and budget deficit torturing the 200 million people in this largest emerging market in Latin America, or the seventh in the world.

(Soundbite) Ronnie Lins, Director of Center of China-Brazil Research and Business
“The economic figures for the first quarter is disappointing, with the unemployment rate rising to 10.7 percent, which is the quarterly worst in history. In this sense, I think Mr. Temer should first of all tell people the truth.”

(Soundbite) Ana Amelia Lemos, Senator
“The previous government should be responsible for the economic instability which aggravates the recession. Brazil is downgraded in investment rating, while inflation soars and unemployment swells. There are now 1.1 million Brazilians without job.”

Among Temer’s all-white-male Cabinet, former central bank chief Henrique Meirelles is a familiar face, which showcases the interim head of state’s determination to intall a business-friendly administration.

(Soundbite) Ronnie Lins, Director of Center of China-Brazil Research and Business
“Temer should produce urgent economic measures, because the situation is worrying. He needs a sound plan, possibly including privatization and seeking support and investors from friendly countries. He needs to grow trustworthy and show the world that Brazil is stable and functions well, which can convince investors to put their money back here.”

(Soundbite) Ana Amelia Lemos, Senator
“It would be worse if not for our abundance of raw materials of agriculture and food. The fluctuation of exchange rates between our currency and U.S. dollar is beneficial for agricultural production, which is more vigorous than industry, trade and service. Industrial production is affected the most. All industrial sectors don’t have good performance.”

A slash of 4,000 high-level public sector aides within the year is the first shot in arm for the government to cut spending and lower the budget decifit. More liberal reforms are believed to follow.

(Soundbite) Hélio José, Senator
“This is only the beginning. We all expect the Brazilian economy to regain growth. China is a member country of the BRICS group, which also includes other emerging countries like Brazil, Russia, India and South Africa. A return to normalcy will help us attract investment from these countries.”

Yes, as a BRICS member, Brazil has some reliable parteners to count on.

(Soundbite) Ronnie Lins, Director of Center of China-Brazil Research and Business
“The BRICS countries will adopt more concrete platforms, like the BRICS Bank (New Development Bank). After all, the mechanism for BRICS has just been initiated and needs to be improved in many regards. I personally think that the BRICS countries should strive for innovation.”

(Soundbite) Cristovam Buarque, Senator
“If Brazil wants to catch up with China, it should reform its education. It can lift us into an innovative country to rhythm with the current development of the world, which is guided by knowledge in an economic sense.”

In up to 180 days, if President Dilma Rousseff is eventually impeached, Temer will serve out her remaining term until the end of 2018.

More than two and half years is more or less enough for him to leave his stamp on this country, if the right solution is adopted.

(Soundbite) Cristovam Buarque, Senator
“We relax over the suspension of Dilma Rousseff, as many investors will return to Brazil. Trust needs to be reestablished, which requires time and patience. It takes months or years to regain the level of confidence like years ago.”

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