Brazil’s Bolsonaro Touts Reform ‘Credibility’ to Davos Investors
(Bloomberg) -- Brazil’s new government has what it takes to implement the policies eagerly sought by global investors, President Jair Bolsonaro said in a speech at the World Economic Forum.
Addressing a packed conference hall in Davos, Bolsonaro noted that this was his first trip abroad as president, an indication of the summit’s importance. The brief speech was short on specifics, but he did promise to carry out pension and tax reforms as part of his administration’s efforts to reduce the role of the state. Brazil will also seek more dynamic trade relations with the rest of the world, he said.
"We enjoy the credibility to carry out the reforms that we need and that the world expects of us," Bolsonaro said.
Bolsonaro took power earlier this month amid optimism that he will boost growth, cut debt and restore order to fiscal accounts in Latin America’s largest economy. The former Army Captain has vowed to help Brazil move beyond a tumultuous period marked by back-to-back years of recession and a massive corruption scandal that implicated dozens of Brazil’s political and business elite.
Brazil’s benchmark stock exchange has set nine record highs so far this year while the currency has gained nearly 2.5 percent against the U.S. dollar after Bolsonaro enlisted a pro-market economic team to push through reforms. Investors’ wish list includes a proposal to curtail pension spending, as well as the privatization of dozens of state-controlled assets.
Accomplishing those tasks won’t be easy, as Bolsonaro will have to rely on a fragmented Congress to approve many of his promises. Complicating matters further is an investigation into suspicious bank transactions involving his eldest son, Senator-elect Flavio Bolsonaro. Flavio has denied any wrongdoing.
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