Brazil Government to Fight Court Decision on Lula in Appeal

  • Attorney General's office is defining the best appeal strategy
  • Local paper reports government will announce stimulus package

Brazil’s government will appeal the decision by a Supreme Court justice late Friday that prevents former President Luiz Inacio Lula da Silva from assuming the ministerial chief of staff position.

The Attorney General’s office is defining the best strategy to proceed with its appeal at Brazil’s highest court, according to its press office. Meanwhile, the government will also announce a stimulus package on Monday that aims to inject 15 billion reais ($4 billion) into the economy in the second half of 2016, newspaper Folha de S. Paulo reported, without saying how it got the information.

Pressure is mounting for President Dilma Rousseff’s impeachment, with millions turning out nationwide in the past week to call for her removal as the Lower House formed a committee to hear the case on whether to oust her. The Brazilian bar association also voted to back the move and popular support for impeachment, as measured by polling company Datafolha rose to 68 percent, up from 60 percent in February.

Among those surveyed by the Datafolha poll, 69 percent rated the government bad or terrible. The poll of 2,794 people was conducted March 17-18, and has a margin of error of plus or minus two percentage points.

Former president Fernando Henrique Cardoso has come to support impeachment citing the government’s inability to function, according to an interview published Saturday by newspaper Estado de S. Paulo. Legitimacy of impeachment comes not from Congress today, but rather from street demonstrations, he said.

Lula Investigation

Supreme Court Justice Gilmar Mendes issued an injunction on Friday night suspending Lula’s appointment and returning a probe of the former president to federal Judge Sergio Moro, saying Lula’s appointment appeared to be an attempt by Rousseff to shield him.

Mendes’s ruling can be overturned by a session of the full Supreme Court, which is the only judicial branch that can probe, indict or imprison presidents or cabinet members.
The Attorney General’s office on Saturday also submitted a request Supreme Court justice Teori Zavascki that all injunctions preventing Lula from assuming the chief of staff position be suspended until the Supreme Court rules on the case, according to its press office.

Brazilian magazine Veja published an interview with Senator Delcidio do Amaral on Saturday, who had been the government’s Senate leader until he was arrested last year and signed a plea bargain while in custody. Do Amaral claimed that Lula negotiated directly with coalition parties for director positions at state-run oil giant Petroleo Brasileiro SA, and knew parties used the positions to finance political campaigns.

The Lula Institute’s spokesperson, Jose Chrispiano, declined to comment on the declarations.

Of those polled by Datafolha, 68 percent said Lula accepted the position as Rousseff’s chief of staff to gain privileged legal status amid the corruption probe. Seven percent said it was for that reason, and also to help strengthen the Rousseff administration.

Political Shadow

Government critics weren’t the only ones overtaking Brazil’s streets this week. Hundreds of thousands of supporters turned out Friday to defend Rousseff and denounce a process many of them say amounts to a coup. The largest demonstration took place in Sao Paulo, where Lula himself joined the rally and told cheering crowds that “Rousseff is suffering a coup attempt.”

Politics overshadowing the nation are drawing attention away from measures required to shore up government accounts, regenerate confidence and help pull the economy from what’s shaping up to be its worst recession on record.

“Improvement in the political situation will also help the economic recovery,” Finance Minister Nelson Barbosa said Friday. “Today the political uncertainty delays the economic recovery.”

Barbosa has already sought to boost economic growth this year by freeing up 83 billion reais in additional lending by state institutions. Brazil’s economy is expected to contract 3.5 percent this year, according to economists surveyed by Bloomberg, following a 3.8 percent dive in 2015. That would be the first time since 1901 that Brazil has had back-to-back recessions deeper than 3 percent, according to data from the government’s economic research institute, known as IPEA.

The press office of Brazil’s Finance Ministry didn’t immediately return calls or e-mails on Saturday.

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