Brazil & Southern Cone - January 2014 (ISSN 1741-4431)

The Brazilian opposition complained loudly in January upon reports that President Dilma Rousseff had asked ministers to accelerate and expand the third phase of the federal government’s public housing scheme Minha Casa Minha Vida in order to build 3.5m new homes in 2015-2018, up from the targeted 2.7m in phase two of the scheme, due to be completed this year.

Senator Cássio Cunha Lima of the main opposition Partido da Social Democracia Brasileiro (PSDB) told the daily O Globo that the government was “taking advantage of the population’s socio-economic difficulties to get more votes”, accusing the government of “massive opportunism”. “The government is using the weaknesses of the poorest sectors to perpetuate itself in power. But that will one day be paid for by society, because it is creating a huge [housing] bubble, the level of arrears is really high”, Cunha noted.

The budget for Minha Casa Minha Vida in 2014 will be R$15.8bn (US$7.0bn), according to planning ministry figures, up R$1.0bn on last year’s R$14.7bn. With private surveys commissioned by the ruling Partido dos Trabalhadores (PT) showing that the government’s flagship conditional cash transfer scheme Bolsa Família no longer exerts the same electoral power as it once did (it has now been in place a decade and has effectively become part of the state furniture, with the Brazilian opposition fully committed to retaining the scheme), President Rousseff wants to make Minha Casa Minha Vida one of her key campaign assets in 2014.

This also comes in response to last year’s national public protests, when the new lower income middle class joined forces with the existing upper middle class to demand of the government better public services, including health, education and transport infrastructure

Brazil awarded public-private sector concessions worth US$34bn in 2013

Pablo Fonseca Pereira dos Santos, deputy secretary for the economy at Brazil’s finance ministry, told the daily O Estado on 5 January that Brazil’s federal government in 2013 awarded private sector infrastructure concessions worth some R$80.3bn (roughly US$34bn) over the course of (average) 35-year contracts. The investment will go into roads, airports, ports, electricity generation and the oil and gas sector. Fonseca identified as the federal government’s three main objectives for 2014: to ensure that each contract moves ahead so that the planned investments are carried out; to work with the private banking sector to get it more involved in public-private partnership (PPP) financing; and to work with domestic and external investors to grow the use of capital markets and new financial instruments like debentures for the infrastructure sector, in an effort to “complement” the role of the national development bank (Bndes), which to date has been heavily involved in the PPP model. Brazil is seeking to move from a consumer- to investment-led growth, Fonseca said.

• The hosts with the most?

In early January President Rousseff announced millions in new funding for education in the 12 Fifa World Cup host cities, reportedly in an effort to head off the threat of fresh public protests in those cities during the June-July tournament (which will coincide with the first anniversary of the 2013 protests).