Brazil In The Year Ahead

The big story making headlines as we get closer to 2013 is that of Brazil's slowing economy. While that will continue to be an ongoing issue to watch, here are a number of other things to keep your eye on in the year ahead.

Issues to Watch: Brazil

• Oil and gas. With the first oil concessions in five years due to take place in 2013, this is the industry to watch next year. But the ongoing royalties fight in Brasilia isn't over yet, and the royalties law could end up in the Supreme Court again if Congress overturns Dilma's partial veto.
• Brazil's new middle class. As one of the most compelling tales of Brazil's growth, this group is the one to watch--especially to see if it can be sustained or grow amid sluggish GDP growth and rising consumer debt.
• Airport and port privatizations. Travelers eagerly await airport upgrades; businesses hope for more efficient ports. The process could be long, but there should be movement in this area next year, especially after the recent announcement that Rio and Belo Horizonte's international airports will also be privatized.
• Construction and housing. In spite of slower growth, this is an area that continues to chug along. FipeZap estimated that real estate prices rose by nearly 14 percent this year and doubled within the last 3 years. The government also hopes to use this sector to boost growth, and the subsidized housing program Minha Casa, Minha Vida is full speed ahead.
• BNDES. Brazil's development bank lent nearly $60 billion through November of this year and could lend up to $73 billion by the end of 2012. Keep an eye on where BNDES is spending, particularly the Brazilian multinationals and major domestic projects, like the controversial Belo Monte hydroelectric plant.
• Government corruption. Will the mensalão defendants actually go to jail? Will Dilma continue to show no mercy for those accused of wrongdoing? Will new transparency laws help uncover new scandals?

Issues to Watch: Rio

• UPPs. Violence has flared up in several of the city's "pacified" favelas, and most of the on-duty military police that died this year died in UPP favelas. Keep an eye on how current UPP favelas are faring in terms of security, as well as plans for new UPPs in other favelas.
• Transportation construction. The bus rapid transit system is underway and operating in a section of the city, with four new stations inaugurated last week. Four more stations are due to open in January with ongoing construction throughout the city. But getting the system online isn't the only challenge; people keep getting hit and killed by the BRT and many have complained about overcrowding. Expanding Rio's metro system is also underway with a price tag of $3.6 billion.
• Militias. The government has focused much of its security strategy on combatting drug traffickers and bringing a permanent police presence to favelas. Will it finally turn the heat up on the city's paramilitary groups?
• Favela removals. Forced evictions from favelas to make way for mega-event construction and urban renewal have stirred controversy on an international scale. Keep an eye out for how these removals play out.
• Mega-event preparations. From stadium construction to training programs, this is an ongoing area to watch. Maracanã Stadium renovations are due to conclude by the end of February, likely over budget. Maracanã is also due to be privatized next year, so keep an eye out for who wins the prize.

People to Watch

• Guido Mantega: Will he hang on as finance minister? If an Economist article won't be his downfall, could more disappointing growth numbers be the final straw? Or will he stay on until the bitter end?
• Joaquim Barbosa: The new president of the Supreme Court became something of a national hero for his hard-line approach during the mensalão trial. But he also decided against immediate imprisonment for those convicted in the trial. Beyond the mensalão, keep an eye on Barbosa and major STF trials next year.
• Lula: The heat recently turned up again from mensalão accusations, though it seems likely he'll remain unscathed for now. But with presidential elections in 2014, will he decide to become a candidate or let Dilma run for reelection?
• Eduardo Campos: The governor of Pernambuco looks like a likely presidential candidate in 2014. Watch for campaign announcements next year.
• Marco Antonio Raupp: Brazil's minister of science, technology, and innovation could be the spokesperson for some of the government's most interesting new initiatives. In November, he announced the launch of Start-Up Brasil, a $40 million project aimed at Brazilian startup companies.

People to Follow

• Brazil's economy - Luciano Sobral, the Drunkeynesian
• Brazil's new middle class - Renato Meirelles of Data Popular
• Brazil tech news and startups - TNW's Anna Heim
• Government transparency - Observing Brazil's Greg Michener
• Everything Rio - RioReal Blog's Julia Michaels
• Rio mega-event preparations, favela removals - Christopher Gaffney of Hunting White Elephants

Comments

[Ray]

Rachel,

Just a clarification, Minister Joaquim Barbosa actually did not decide, he didn't have a choice regarding the immediate prison of those convicted in the Mensalao scandal. He is just following procedural law.
It's a Brazilian Judicial procedure technicality, you cannot imprison the convicted until the sentence "Transitar em Julgado", which is an obligatory waiting period in the Brazilian Procedural Law. They will be imprisoned as soon as the sentence "Transitar em Julgado" which is sort of when the sentence becomes official. Yeap, I hear you, blame the romans and Roman law for this one... ;)

Abracos
Ray

[Rio Gringa]

Thanks Ray, a lawyer friend also explained Barbosa's reasoning to me. But she also said that those sentenced could have multiple appeals depending on what happens...so we'll see how it all plays out.

[Ray]

Exactly, the waiting period is used for the defense attorneys examine the sentence and look at all options for appeals. Trust me, we are all at the edge of our seats watching this one really close... Abracos

Ray