Brazil’s House Leader Says He’s Not Trying to Create ‘Chaos’

Updated on

Brazil’s lower house President Eduardo Cunha is downplaying concerns that his decision to abandon the government alliance will worsen the country’s economic turmoil.

“I don’t have a history of helping to create chaos in the economy through measures that put public accounts at risk,” Cunha wrote on his Twitter account Saturday. “As president of the lower house, I will continue to behave as I’ve always done.”

The comments came a day after Cunha identified himself as a member of the opposition and urged his party, Brazil’s biggest, to leave the ruling coalition. The newspaper Folha de Sao Paulo reported Saturday that Cunha would rebel against the administration by blocking a fiscal-austerity package designed to shrink the budget deficit.

Cunha’s announcement escalated a political crisis that already had driven President Dilma Rousseff’s popularity to a record low and revived talk of impeachment. The real on Friday was the worst performer among emerging-market currencies as concerns grew that instability will send Brazil deeper into recession.

Brazil’s currency weakened 1 percent Monday to 3.2187 per U.S. dollar at 11:09 local time.

The congressman announced his decision after an informant alleged that he received kickbacks in exchange for a contract with Brazil’s state-run oil company, Petrobras. The investigation into Cunha is part of a probe of more than 50 politicians accused of graft, including some from Rousseff’s Workers’ Party.

Personal Decision

Cunha denies wrongdoing and said Friday the charges were part of a government strategy to weaken him politically. He wrote Saturday that the decision to abandon the government alliance was his own and he won’t try to convince politicians outside his party to follow.

His Democratic Movement Party said in a statement that the lawmaker’s choice is personal and doesn’t reflect the position of the PMDB, as the party is known.

While lawmakers were largely quiet on the matter over the weekend, Senate President and fellow PMDB member Renan Calheiros spoke highly of Cunha while criticizing the government’s fiscal-austerity program for failing to restart growth.

‘Excellent Relationship’

“I have an excellent relationship with the president of the lower house,” Calheiros said in a video posted on the Senate website. “He has been a good president of the chamber, implementing a rhythm to the voting schedule. I think his actions, his independence, contributed a lot to the national Congress.”

The presidential press office said in a statement it expects Cunha to remain impartial as president of the lower house.

Cunha’s leadership in Congress makes him instrumental in choosing whether to hold a vote to impeach Rousseff, who is defending her administration from charges she broke the fiscal responsibility law in 2014 as well as campaign rules in last year’s re-election. The government denies wrongdoing.

The lower house leader indicated Saturday he isn’t trying to take down the president.

“My move doesn’t mean I’m looking to win numbers to confront and defeat the government,” Cunha wrote on Twitter. “There’s no agenda of revenge here.”

Before it's here, it's on the Bloomberg Terminal. LEARN MORE