On 11 August, Brazil’s Economy Minister Paulo Guedes confirmed that two key members of his ministerial team, privatisations secretary Salim Mattar and debureaucratisation secretary Paulo Uebel, had resigned.
Analysis:
Mattar’s and Uebel’s resignation, over dissatisfaction with the slow progress of reforms making it impossible to get their work done, further whittles down the economic team put together by Guedes before he took office in January 2019. This weakens Guedes’ hand at a sensitive time, as the economy minister tries to defend before congress his version of a reform to Brazil’s complex tax system, and faces discussions on the constitutional spending cap ahead of presenting next year’s budget.
- “There was a stampede today”, Guedes admitted during a press conference yesterday after confirming that Mattar and Uebel had both resigned. In the wake of their departure, José Ziebarth, the economy ministry’s director of the privatisations programme, also tendered his resignation.
- Guedes said that Mattar was unhappy with the slow progress of privatisations, while Uebel’s grievance was with the lack of advance in the long-promised administrative reform. “[Mattar] said that it’s very difficult to privatise, that the establishment doesn’t let it happen”, Guedes said, comments which Mattar repeated in an interview with CNN Brasil. “When you start privatising, you’re shaking up the game of [political] interests”, he said. “The political class has no interest in privatising. So that is why the process is slow”.
- Guedes has sought to minimise the significance of these resignations by implying that Mattar and Uebel gave up. “We’re going to insist on this path [of privatisations]. At least we’re going to fight”, Guedes said.
- With Mattar and Uebel leaving government, Guedes has already lost five key members of his economic team as well as the heads of two state banks since January 2019. Three left in July alone: Mansueto Almeida, previously national treasury secretary; Caio Megale, who was programmes director in the finance secretariat; and Rubem Novaes, who had been named by President Jair Bolsonaro as CEO of the state-run Banco do Brasil (BB).
Looking Ahead: Mattar and Uebel’s replacements are yet to be announced, but Guedes said that his reaction to these defections would be to “accelerate the reforms” and “unblock investments”.