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Brazil on Edge as Lula Awaits Judgment at the Supreme Court

Brazil On Edge as Lula Awaits Judgment at the Supreme Court

(Bloomberg) -- Brazil’s Supreme Court is to rule on former President Luiz Inacio Lula da Silva’s plea to remain at liberty despite a lengthy prison sentence, a decision likely to shape the outcome of October’s elections and mark the culmination of an epic corruption scandal.

On Wednesday afternoon the court’s 11 judges will argue the merits of Lula’s request to stay out of jail despite losing an appeal against a criminal conviction for corruption and money-laundering. Lula argues he should not be imprisoned until he has exhausted all chances for appeal. He is currently the front-runner in opinion polls for October’s presidential election, though it is highly likely he will be barred from taking part.

Brazil on Edge as Lula Awaits Judgment at the Supreme Court

The court’s decision could pave the way for the once hugely popular president to be put behind bars and become the highest-profile casualty of Operation Carwash, the four-year long corruption investigation that has shaken Brazil’s culture of impunity. Since leaving office in 2010 with sky-high approval ratings, the former trade unionist has become a deeply polarizing figure, still beloved on the left for the legacy of his social policies, but reviled by the right for the corruption that flourished under 13 years of Workers’ Party rule. Investors are wary of his pledge to undo recent pro-market policies.

In a sign of growing tension, Brazil’s Army chief on the eve of the court hearing issued a veiled warning. Without mentioning the case, General Eduardo Villas Boas wrote on his Twitter account that the Brazilian Army was mindful of its institutional mission and shares the wish of all good citizens in repudiating impunity. Brazil’s current situation, he wrote, begs the question who is thinking about the well-being of the country and who is only concerned with personal interests.

Pro- and anti-Lula protesters gathered in some of the country’s main cities on Tuesday evening. In a highly unusual move, the president of the Supreme Court, Carmen Lucia, gave a televised address on Monday appealing for calm. Last week, two of Lula’s campaign buses were hit by gunfire while traveling in the southern state of Parana.

Further demonstrations are expected in Brasilia on Wednesday in an attempt to influence a decision that will send shock waves across Latin America’s largest economy, whatever the result. While Lula and his supporters argue the charges against him are politically motivated, opponents insist his imprisonment represents progress for justice in the country.

Brazil’s top electoral court, rather than the Supreme Court, will decide whether Lula can run in this year’s election. As the law stands, he should be ruled out on the basis of his criminal conviction, but a decision will only come after the Aug. 15 deadline for registering candidates.

Aside from Lula’s specific case, the Supreme Court may also rule on the general principle of whether convicted criminals can remain at liberty until they have exhausted the appeals process, a judgment with widespread implications.

To contact the reporters on this story: Simone Iglesias in Brasília at spiglesias@bloomberg.net, Mario Sergio Lima in Brasilia Newsroom at mlima11@bloomberg.net.

To contact the editors responsible for this story: Raymond Colitt at rcolitt@bloomberg.net, Bruce Douglas, Robert Jameson

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