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Can Brazil president survive growing Petrobras scandal? 10 февраля 2015, 13:47

Mounting allegations that her party received hundreds of millions of dollars in a kickbacks scandal engulfing oil giant Petrobras have sent Brazilian President's poll ratings tumbling.
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 Mounting allegations that her party received hundreds of millions of dollars in a kickbacks scandal engulfing oil giant Petrobras have sent Brazilian President Dilma Rousseff's poll ratings tumbling and could fatally undermine her, AFP reports.

 Rousseff only embarked on a second term in office last month, having succeeded popular Workers Party (PT) predecessor Luiz Inacio Lula da Silva in 2011 after his eight years at the helm.

But the widening graft scandal, estimated at $3.8 billion and dubbed Operation Car Wash, might see her embattled administration fail to ever recover, analysts say, after it wiped billions of dollars off the market value of Brazil's biggest firm.

"The jewel in the crown has literally been destroyed," said David Fleischer, professor emeritus of political science at the University of Brasilia.

"The Petrobras kickbacks scandal is getting worse by the day," Fleischer told AFP.

"The republic's prosecutor general is getting ready to press charges against 30 to 40 politicians, lawmakers, former lawmakers, senators and ministers for their involvement in the Petrobras scandal."

Last week's resignation of Rousseff confidante Graca Foster as Petrobras CEO briefly cheered the market -- but only until banking executive Aldemir Bendine, likewise close to the ruling PT, was unveiled as her successor at the state-owned company.

With Foster having fallen on her sword, the heat is now on Rousseff, herself a former Petrobras board chair.

Rousseff, a former urban guerrilla tortured under the 1964-1985 military dictatorship, narrowly beat social democrat Aecio Neves in October's presidential election runoff. But a weekend opinion poll by Datafolha showed her rating slumping 19 points to just 23 percent.

Rousseff, whose reelection frustrated the market, suffered a new blow Sunday when Folha de Sao Paulo newspaper quoted a former director of Sete Brasil, which supplied drilling rigs for Petrobras, as claiming the PT scooped $431 million from overcharged contracts.

The president was already reeling after Congress elected a critic of hers as speaker of the Chamber of Deputies.

Eduardo Cunha is from a governing coalition ally, but saw off a PT rival for the post.

"The election of Eduardo Cunha was a resounding defeat for Planalto," the seat of government in Brasilia, according to Carlos Pereira, professor of political science at the Getulio Vargas Foundation.

"This is going to be a year of crisis management," forecast Valdir Raupp, a senator with Cunha's PMDB, Brazil's largest party and whose support is crucial to the Rousseff administration.

Raupp told AFP his party would play a "fundamental role in administering this crisis."

     Mounting woes 

 Former president Lula expressed indignation, meanwhile, after last week's arrest of PT treasurer Joao Vaccari Neto.

Neto was questioned for several hours over reported payments to the PT of between $150 and $200 million between 2003 and 2013.

He and the PT have denied any wrongdoing but Lula derided what he called the "criminalization" of the party.

Despite mounting evidence to the contrary, Raupp remains optimistic Rousseff and her government can survive.

"In Lula's first term we went through a very similar crisis which almost led to the impeachment of the president, but we came through it. Lula was re-elected and formed a great government," he said.

"And in Congress there is in no way a yearning today for an impeachment demand."


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