- Title: Brazil's Haddad vows to 'restore' public accounts
- Date: 3rd January 2023
- Summary: BRASILIA, BRAZIL (JANUARY 2, 2023) (REUTERS) BRAZILIAN FINANCE MINISTER FERNANDO HADDAD WALKING TOWARDS LECTERN HADDAD AND BRAZILIAN OFFICIALS DURING THE EVENT HADDAD HANDS HADDAD AND BRAZILIAN OFFICIALS DURING THE EVENT (SOUNDBITE) (Portuguese) BRAZILIAN FINANCE MINISTER, FERNANDO HADDAD, SAYING: "I assume with all of you the commitment to send the National Congress the proposal of a new fiscal framework that organizes the public accounts in the long term."
- Embargoed: 17th January 2023 00:19
- Keywords: Brazil President Luiz Inacio Lula da Silva economy politics
- Location: BRASILIA, BRAZIL
- City: BRASILIA, BRAZIL
- Country: Brazil
- Topics: South America / Central America,Government/Politics
- Reuters ID: LVA001000402012023RP1
- Aspect Ratio: 16:9
- Story Text:Brazil's new finance minister, Fernando Haddad, said on Monday (January 2) he would propose a new fiscal anchor in the first half of this year as leftist President Luiz Inacio Lula da Silva's team works to "restore" public accounts.
A former mayor of Sao Paulo, Haddad took office with the challenge of presenting a credible fiscal framework after Congress passed a package increasing Brazil's spending cap to ramp up social expenditures.
In his first speech in office, Haddad said the government would not accept the "absurd" 220 billion-real ($41.19 billion) primary deficit forecast in this year's budget, indicating it will work to reduce it.
He pledged to fight inflation, promising to send to Congress the proposal for a new fiscal anchor in the first half of the year seeking to ensure public debt sustainability.
But he did not mention Lula's decision the day before to extend a costly tax exemption on fuels, in what some saw as a striking political setback for the new minister.
Prior to taking office, Haddad had stated that the measure - which has an annual impact of 52.9 billion reais - would not be extended.
Speaking to journalists after the event, he said Lula asked for an extension so that a decision on resuming fuel taxes could be taken once the new board of state-owned oil company Petrobras PETR4.SA is installed. The taxes boost federal revenue but harm Lula's popularity.
A lawyer with a master's degree in economics and a doctorate in philosophy, Haddad has been viewed with distrust by the market for fear of uncontrolled spending.
He sought to dispel these concerns on Monday, saying the harmonization of fiscal and monetary policy would happen "for sure." Haddad said he will also try to democratize access to credit and establish a more transparent tax system.
Brazil's new Justice Minister, Flavio Dino, said he will work to defend democracy and combat terrorist acts.
The political tensions and bomb threats in Brazil have prompted the new government to beef up security protocols in the last week.
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