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Brazil president reshuffles cabinet to avert disaster

03 october 2015, 17:32
0

Brazilian President Dilma Rousseff ordered a government reshuffle Friday, axing eight ministries in what was announced as a cost-cutting measure but seemed aimed at ending political paralysis and threats of impeachment, AFP reports.

At a time of recession, a massive corruption scandal and political turmoil, Rousseff said the shakeup would help put the world's seventh biggest economy and Latin America's largest country back on track.

The reshuffle aims "to guarantee the political stability of the country which is needed to renew growth and strengthen relations between the parties and members of parliament who support the government," Rousseff, 67, said in the capital Brasilia.

Rousseff, who was narrowly elected last year to a second term, has already turned into a lame duck president, struggling to pass budget cuts and tax increases that her government says are necessary to help the floundering economy recover.

With the corruption scandal centered on state oil company Petrobras badly tainting Rousseff's Workers' Party, the president has seen her popularity ratings sink to 10 percent and faced impeachment threats in Congress, even from within her shaky ruling coalition.

The government reshuffle appeared aimed above all at shoring up that power base by placating rivals.

"Coalition governments need support from Congress. We live in a democracy," she said. 

"It's Congress, elected by the Brazilian people, that my government must have a dialog with on getting support for ways and laws to speed up the exit from the crisis," she said.

Not that the opposition was impressed.

"The reforms deepen the government's lack of credibility. It's a scheme for trying to escape impeachment," said Senator Cassio Lima from the PSDB, which despite also being leftist is opposed to the Workers' Party.

But the Sao Paulo stock market welcomed the potential for an improvement in the political climate, closing 3.79 percent higher on the day.

  Power shifts 

The changes cut the number of ministries from 39 to 31 in Brazil's sprawling bureaucracy.

"Today, we are making a first and major step toward the reorganization of the federal public administration. We are beginning by reducing eight ministries," Rousseff announced.

A big winner in the reshuffle was the center-right PMDB, which is Rousseff's most powerful, but not always reliable, partner in the ruling coalition. 

Analysts said Rousseff boosted the PMDB's ministerial portfolio in hopes of winning support for economic reforms that have come under heavy criticism since she unveiled them a month ago.

They include spending cuts and the reinstatement of an unpopular tax on banking transactions.

Rousseff said rivals should now come together to pass measures which are needed for the common goal of restoring economic growth. 

"We have to put the interests of the country above those of the parties," she said.

The reshuffle gave the PMDB seven ministries, up from six. That included changing the health ministry, which has the biggest budget and considerable political importance, from the Workers' Party to the PMDB.

The Workers' Party remained the biggest player with nine ministries.

But the reshuffle also reflected internal party shifts and the possibility of party founder and former president Luiz Inacio Lula da Silva seeking a return to power in the 2018 elections.

Defense Minister Jacques Wagner, a Lula ally, moved over to the politically key post of presidential chief of staff, replacing a Rousseff confidant.

"The president has decided on this reshuffle after pressure from the PMDB and from former president Lula with the hope of reducing the risk of impeachment proceedings," said Ricardo Ribeiro, an analyst at MCM consultants. 

"She is trying to make sure of the PMDB's support."

Stratfor, a US think tank, said the PMDB is now firmly in the driving seat, with the Petrobras corruption scandal increasing the Workers' Party's "reliance."

"The PMDB must decide whether to remain a part of the ruling coalition or defect to the opposition," Stratfor said.


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