1. Fighting Hunger Without Money
“The Brazilian people want to live well, eat well, live well,” Brazil’s new president Luiz Inácio “Lula” da Silva, 77, said in his victory speech on Sunday. Lula’s popularity reached an all-time high when he achieved exactly that progress between 2003 and 2011: more purchasing power for the poor and the middle class. Brazil gained international fame in those years for eradicating hunger.
But the corona pandemic, which not only killed 700,000 Brazilians, also brought back hunger: 33 million people live with hunger every day, a study in June found. Half of the 215 million Brazilians suffer from ‘food insecurity’.
“As the third largest food producer in the world, we must guarantee that every Brazilian has breakfast, lunch and dinner every day,” Lula said in his speech. “That’s this government’s number one priority.”
In order to succeed, he wants to maintain the poor benefit of his predecessor Jair Bolsonaro, 110 euros per month for 21 million people. He also promises a minimum wage that moves with inflation, and investments in infrastructure, healthcare and education. The question is where does he get the money from? Bolsonaro leaves behind a substantial government debt of about 80 percent of the gross domestic product (about 1.6 trillion euros).
2. The battle with São Paulo
São Paulo, with 44 million inhabitants, is by far the most powerful and richest state in Brazil. Lula hoped to win over the gigantic economic engine by choosing popular former governor Geraldo Alckmin (a former opponent) as running mate. The plan failed. The battle for the governorship of São Paulo was won by Bolsonaro ally Tarcísio de Freitas (47).
‘Tarcísio’, known by his first name like many Brazilian politicians, is a former soldier and was Minister of Infrastructure in Bolsonaro’s government until March of this year. A bright spot for Lula: Tarcísio immediately acknowledged Lula’s victory and said he hoped for “a good understanding” with his government. The right-wing politician is not among the most armored bolsonaristas. In the past, he was a senior official under leftist President Dilma Rousseff.
President Lula also encounters (fervent) right-wing governors in other large states. The central states of Minas Gerais and Rio de Janeiro (population 37 million together) elected Bolsonaro allies as governors.
3. On a collision course with Congress
The power of the Brazilian president is limited. He must negotiate with a Congress where disparate factions pursue their own interests, from the rich agricultural sector to (new this year) the indigenous women’s bloc.
At the heart of the parliament is the powerful ‘Centrão’, an opportunistic group of ‘centre’ politicians who sell their political support dearly in exchange for large government budgets, for example. Lula has shown in the past that he is a shrewd negotiator, not shying away from bribery, but this time he has little cash in hand to placate the opportunists.
At the beginning of this month, during the first round of elections, Brazil also voted for part of Congress. Bolsonarism was doing good business. Lula’s left-wing coalition won less than a quarter of the seats in the House of Commons and even less in the Senate. Bolsonaristas won about a third of the seats. The opportunistic center bloc remains the largest.
Lula meets hardened populists in parliament such as Bolsonaro’s sons Flavio (Senate) and Eduardo (Lower House), his strict Christian Minister for Women’s Affairs Damares Alves (Senate), and his former justice minister Sergio Moro (Senate), also the former investigating judge who in 2017 Lula convicted of corruption. Re-elected far-right parliamentarian Carla Zambelli, who chased a man in São Paulo with gun in hand on Saturday, promises to “lead the biggest opposition Lula can ever imagine”.
4. Wrong Friends
In Lula’s absence, relations on the world stage shifted. Lula already knows Presidents Putin and Xi from his previous reign. The three proudly formed the Brics alliance of rapidly emerging economies along with India and South Africa.
As president, Lula tightened ties with China and trade between the countries skyrocketed. About a third of Brazilian exports now go to China, no other country buys as much Brazilian soy as Xi Jinping’s country. Brazil also has a close trade relationship with Russia. Brazilian soy production largely runs on Russian fertilizer.
Putin’s invasion of Ukraine has also pushed up food prices in Brazil. While poor Brazilians could no longer afford their food and petrol, large farmers and the state oil company Petrobras took advantage. “The US and the EU are also to blame,” Lula said in May of the Ukraine war, if only they had guaranteed that Ukraine would never become a NATO member.
Xi and Putin were quick to congratulate Lula on Sunday evening. Other world leaders with high hopes for Lula, those of the EU and the US, look to China with growing suspicion and horrified war president Putin. It will be a lot harder for Lula to remain the merchant who does business with everyone.
5. Impunity in the Amazon
The Amazon, the largest rainforest in the world, has been emitting more CO2 than it absorbs since last year. Under Bolsonaro, deforestation rose to the record highs seen in the early years of Lula’s presidency. Bolsonaro curtailed the rights of indigenous peoples and gave ample scope to (mostly illegal) economic development in the rainforest.
It’s Lula’s job to give environmental authority Ibama teeth again and rebuild the Funai indigenous institute, stripped down by Bolsonaro. There is also an economic interest involved, the European Union has made Brazilian environmental policy a precondition for a new trade agreement and international companies are demanding a halt to logging. At the same time, the EU is also a major buyer of Brazilian soy.
Lula has a great job ahead of her. Perhaps the biggest challenge is the battle in the vast Amazon itself. Impunity reigns, illegal loggers, miners and prospectors have penetrated deep into the forest, often under the watchful eye of (corrupt) local authorities.