Reuters/Brasilia
Former Wall Street banker Henrique Meirelles is a frontrunner to be Brazil’s next finance minister, sources close to the government said, in what would mark a major shift toward business-friendly policies in President Dilma Rousseff’s second term.
Meirelles, 69, is widely respected in financial markets and was a main architect of the leftist ruling party’s pragmatic policies when he led the central bank from 2003 to 2010, a period that twinned robust economic growth with low inflation and strong anti-poverty programmes.
He often clashed during those years with Rousseff, who favours a more leftist, interventionist approach and has made many economic decisions herself since taking office in 2011.
Latin America’s biggest economy has stagnated under her watch, averaging less than 2% growth per year or half the expansion rate of the previous decade.
Fears that Rousseff would win re-election and continue the same policies dragged Brazilian stocks down more than 20% between early September and immediately after her narrow victory on October 26.
They have since recovered slightly but remain volatile over uncertainty about the economic course she will take.
Even some of Rousseff’s allies - among them influential former president Luiz Inacio Lula da Silva - are encouraging her to choose Meirelles, who would likely oversee big budget cuts and a return to more orthodox policies in an effort to ward off a prolonged stagnation or downgrades of Brazil’s credit ratings next year.
“Until recently, nobody believed Meirelles could be in the running, but his name is gaining ground and fast,” said a senior lawmaker with the ruling Workers’ Party who met with both Rousseff and Lula last week.
“She has acknowledged the need for more drastic changes to turn the economy around,” the lawmaker said on condition of anonymity.
The lawmaker and other government sources said the other leading candidate is Nelson Barbosa, the former deputy to current Finance Minister Guido Mantega, who will leave government before Rousseff’s second term starts on January 1.
Although Barbosa has publicly criticised the lack of transparency in Brazil’s public accounts, he is considered a leftist economist who shares many of Rousseff’s convictions that the state should have a big role in the economy.
Meirelles, by contrast, is associated with the orthodox economic views of the Brazilian Social Democracy Party - the centrist party whose candidate, Aecio Neves, Rousseff defeated last month. Meirelles won a Senate seat on the PSDB ticket in 2002, but then quit the party before taking over as central bank governor.