World Economy

Brazil’s Temer Promises Reforms

Brazil’s Temer Promises ReformsBrazil’s Temer Promises Reforms

Brazil’s President Michel Temer vowed to push ahead with unpopular measures to revive a troubled economy, saying his lack of electoral ambition gives him a free hand to act.

In an interview at Bloomberg headquarters in New York, Temer said he would spend all his political capital to shore up public accounts, expressing confidence that Congress would approve his proposals by the middle of next year to limit public spending and reform pensions. While he signaled he would be tougher on granting further raises for civil servants, he said the treasury could find room to provide aid for debt-stricken states.

“I have no electoral ambition for 2018, therefore I will be at ease to face apparently unpopular issues,” Temer said Monday, on the eve of addressing the United Nations General Assembly. “Now that I’ve definitively taken office, I’m taking a tougher stance in politics and economics.”

A 75 year-old constitutional lawyer, Temer this year inherited a deeply divided country rattled by recession and a two-year corruption scandal that has heightened Brazilians’ distrust of politicians. Inflation is running at 9% and unemployment is at its highest since 2004. Following the impeachment of his predecessor Dilma Rousseff on Aug. 31, Temer has faced small but persistent protests challenging his legitimacy.

“We’re still in a very difficult situation, economically speaking,” he said. “Even if we improve just a little bit next year that would be a big step forward.”

To boost investor confidence, much of Temer’s agenda aims to reduce the government’s role in the economy. Legislators will approve government bills to cap public spending rates and curtail payouts on retirement benefits by the end of 2016 and the middle of 2017, respectively, he said.