- Title: Brazil president resists calls to resign amid allegations of witness bribery
- Date: 18th May 2017
- Summary: BRASILIA, BRAZIL (FILE) (REUTERS) ****WARNING: CONTAINS FLASH PHOTOGRAPHY*** VARIOUS OF PRESIDENT MICHEL TEMER WAVING AT INAUGURATION
- Embargoed: 1st June 2017 16:41
- Keywords: JBS Odebrecht Aecio Neves Brazil corruption Michel Temer
- Location: BRASILIA, CURITIBA, RIO DE JANEIRO, BRAZIL AND NEW YORK, NEW YORK, U.S.A.
- City: BRASILIA, CURITIBA, RIO DE JANEIRO, BRAZIL AND NEW YORK, NEW YORK, U.S.A.
- Country: Brazil
- Topics: Government/Politics
- Reuters ID: LVA0036HDA6GZ
- Aspect Ratio: 16:9
- Story Text:Brazilian President Michel Temer resisted calls to resign on Thursday (May 18) after allegations that he condoned the bribery of a potential witness in the massive "Car Wash" graft investigation, news that sent markets tumbling and raised doubts that Congress would pass his austerity measures.
Temer strongly denied the allegations and told allied lawmakers in a morning meeting that he would not be driven from office. He cleared the rest of the day's schedule to react to the crisis and was expected to address the nation on national TV within hours, aides said.
Political analyst, Ricardo Ismael, said the political system, which has for 25 years been dominated by the Brazilian Social Democratic Party, the Workers' Party and the Brazilian Democratic Movement Party, is now falling apart and that political decisions regarding necessary reforms would be put on hold amid uncertainty over Temer's position.
Ismael also said the economy could reach a "dead point", as people making new investments and contracts with recently renewed confidence would now wait for some certainty following this fresh crisis.
Brazilian markets slumped on concerns that the investigation could derail Temer's economic and fiscal agenda. Shares of state-controlled companies, such as Banco do Brasil SA and Petroleo Brasileiro SA, or Petrobras, lost more than 10 percent of their value, and the nation's currency fell 7 percent, wiping out its gains for the year.
The O Globo newspaper reported on Wednesday night that Temer met in March with Joesley Batista, chairman of meat company JBS SA, which grew rapidly under 13 years of leftist Workers Party rule due largely to low-cost loans from Brazil's national development bank.
Batista, who is trying to secure a plea-bargain deal with prosecutors, recorded the conversation in which he and Temer allegedly discussed making illegal payments to jailed former House Speaker Eduardo Cunha, of the PMDB, to keep him from testifying about corruption.
Temer himself has been named in plea bargain testimony as negotiating millions in illegal campaign funding, which he denies. However, top federal prosecutor Rodrigo Janot has said that under Brazilian law, Temer cannot be investigated for crimes committed before he became president until he leaves office. But the new allegations refer to an incident that took place after Temer took office, which would open the door to an investigation against him. - Copyright Holder: FILE REUTERS (CAN SELL)
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