A Facebook friend and reader, Innocent A. Nweze, wrote to alert that my 2017 prediction blog (https://allabroadconsulting.wordpress.com/2017/01/04/2017-predictions-for-brazil-happy-new-year/) was more a rehash of 2016 then a forecast for the New Year. I answered Innocent with something to the effect that 2016 has not yet ended in Brazil and it is, as we say in futbol, only the prorogacao or added time. (As many acknowledge, nothing happens until the end of summer and Carnaval so still waiting for 2017 to begin around March 1.)
Still, here are his points in italics.
(1) Some sort of self-reexamination. A kind of “cleansing” if you like. Cleansing of the old, but are not certain what to replace the old. So what could be the impact of this sort of transition for Brazilians in 2017. Maybe the general impact on Latin America.
(2) Will there be a transformation of the Political System in 2017? Will there be a convergence of the political parties or will they remain splintered as is currently? Will the transformation be gradual or sudden and quick in 2017? What should we expect?
(3) Brazilian infrastructure and institutions. Good and bad, what is to be expected in 2017? Post 2017 too. Advanced Agriculture, deep expertise in deep sea drilling technologies, manufacturing, poverty alleviation for which Brazilian recently gained recognition, no matter how perfunctory. What should we expect in 2017, even in the near term?
(4) Politics and corruption and impact on the economy in 2017.
Point by point:
- Certainly Brazil is going through self-examination, but how deep this goes is a question. If people are not educated and informed and capable of critical reflection, it is hard to go beyond the surface. Brazil has made tremendous quantitative strides since 1960 in expanding education and reducing illiteracy. However, the quality of education is not there. Information is also a major problem. Although Rede Globo is not as dominant as it used to be, it is still the most important media vehicle and, overall, does not make people think as much as making them think in one direction. And Globo is just the prominent tip of this iceberg. It is nice to suppose that access to social networking is breaking down this monopoly, but usage needs to further expand and important economic and media groups control the most popular sites.
- Transformation of Brazil’s political situation is halting and slow. Temer’s major challenge, an area where he has made some important initiatives, is the economy. As I mentioned in the 2017 predictions, the PMDB and allies threaten the corruption investigations and seek the status quo where they receive a lion’s share of benefits. I don’t see party reform on the 2017/2018 agenda, as it is not in the personal interest of the politicians in Congress.
- Brazil’s infrastructure is notoriously deficient. Some improvements are made through privatizing. But each privatization diminishes power politicians have to appoint and control so again they are not readily favorable. In addition, the country has been in recession and the government is bloated and fails to provide social and economic benefits. The recent administrations have overtaxed and spent poorly creating a black hole so there is little or no money for investments. Yes, there are areas of excellence such as the deep-sea extraction technology. But this technology is part of a larger system of worldwide petroleum production and political/economic management at Petrobras. Brazil needs to define where its national interest lie in the oil fields and how to best exploit them either in conjunction with multinationals or by itself. Alone, at the moment, Petrobras does not have the resources or even access to the funds necessary to take advantage of what it knows. So in the end, expect increases in poverty with rises in unemployment and only moderate or no gains at all in manufacturing. Even if Bolsa Familia (a good program) remains, it is not a solution to the basic problem of employment and production. Agriculture is increasingly important but hampered by lack of infrastructure and affected by fluctuations in demand and the weather.
- Politics and corruption provides an interesting bridge to connect Temer and Trump and the international milieu. Temer and his cohorts threaten the progress of corruption investigations in Brazil. Trump, in his lack of transparency and given his past business dealing does not appear to be a paragon of moral rectitude. He has asked for the resignation of all ambassadors by his inauguration on Jan. 20. It will be a bit ironic if Liliana Ayalde, who the left views as a coup monger is replaced by someone more overtly favorable to US corporations and with a blind eye toward malfeasance whether it be by the oil companies, the NSA, or the CIA. So Ms. Ayalde may actually be missed. Apart from that Trump appears to have little interest in Brazil as a nation. He may praise Doria or Bolsonaro or even the developers of Trump Rio, but in the end he will do what is good for his own interests and those of his allies such as the presumptive Secretary of State Mr. Tillerson (formerly Exxon). Brazil and Temer may put up a stiff upper lip and smile but they should be disabused of the idea that Trump will do them any favors.
In the end, we can hope for gradual improvements just because people in Brazil are generally positive and are gradually coming to recognize that their dependence on a paternal state is not productive and no longer tenable. Young people are unleashing a tremendous amount of entrepreneurial talent and given Brazil’s size and the wealth that already exists will eventually find a way to more equality and prosperity. It may take a hundred years and there are no guarantees but we need to have faith and hope.