2010-11-03

Brazil’s Rousseff Begins Pro-Market Transition

Newly-elected Brazilian President Dilma Rousseff waves to the reporters before meeting with key politicians who supported her campaign.  AFP photo.

Newly-elected Brazilian President Dilma Rousseff waves to the reporters before meeting with key politicians who supported her campaign. AFP photo.

REUTERS

Brazilian President-elect Dilma Rousseff has named a pro-market transition team as she prepares to lead a powerful economy at risk from high government spending and an overvalued currency.

Rousseff, who based her campaign on continuing the legacy of President Luiz Inácio Lula da Silva, won her first election on 31 October, when Brazilians voted by a wide margin in favor of continuity.

After a bitter campaign in which she offered few specifics about her policies, Lula’s former cabinet chief chose a seven-member transition team, made up chiefly of moderate elements of her leftist Workers’ Party (PT), a close advisor told Reuters.

The chief figure among them is Antonio Palocci, a respected former treasury minister in Lula’s administration who is popular on Wall Street and who will probably have a prominent role in Rousseff’s administration, perhaps as cabinet chief.

Also prominent are, among others, José Eduardo Dutra, president of the PT and former chief executive of the state-owned petroleum firm Petrobras; Fernando Pimentel, former mayor of Belo Horizonte; and Marco Aurelio Garcia, a foreign policy adviser to Lula.

One of Rousseff’s first challenges when she takes office on New Year’s Day will be dealing with the Brazilian real, which is at its highest level against the dollar in two years and is affecting exports.

In a series of interviews with television stations, Rousseff said that there is evidence that there is a foreign-exchange war going on in the world and that it is the task of international institutions to ensure that countries do not maintain devalued currencies.

“I start to devaluate, another country starts to devaluate, and this blocks trade (…) it creates a trade war,” the president-elect maintained.

Rousseff affirmed that her administration will maintain the policy of setting a target for inflation. “We’re not going to play around with inflation,” she said in a television interview prior to taking several days off after the exhausting four-month election campaign.

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