A Presidential Bid by Brazil’s Finance Minister Is on Hold, for Now

Brazil’s Finance Minister Henrique Meirelles wants to throw his name into next year’s presidential race but realized there are still too many unknowns to do so now, according to five people with knowledge of his thinking.

Meirelles will only bid for the country’s top job with a stronger economic recovery, a coherent strategy to deal with near-zero government approval ratings, and more certainty that the current front-runner, former President Luiz Inacio Lula da Silva, won’t run.

As none of those conditions are given and to avoid distraction from the task of fixing Brazil’s economy, the former BankBoston executive has put any preparatory work for a possible candidacy on hold until at least December, according to two of the five people.

That means he may face yet other awkward moments like he did earlier this month when his PSD party essentially put his name forward only to have him neither confirm nor deny his intentions, saying he was flattered by the praise. Indeed, Meirelles rejoices in being repeatedly asked about the job, said one of the five people who regularly speaks to the minister about the issue.

“One should not say I’d never do something or I will do something. I focus on the present,” Meirelles told Bloomberg TV this week when asked about a possible candidacy.

Asked to comment for this story, Meirelles reiterated he’s not a candidate and that he remains focused on his current job. “I see the possibility of a candidacy being mentioned only as a recognition of the work that is being done.” 

Viable Candidate?

Latin America’s largest economy is enjoying a modest recovery after the worst recession on record and inflation is on target for the first time in seven years, in part due to the credibility Meirelles enjoys in financial markets. Yet life hasn’t meaningfully improved for most Brazilians, particularly the 13 million who are still unemployed.

“For him to be a viable candidate the economy would have to be booming,” said Carlos Melo, a political scientist and professor at the Insper business school. “He’ll deliver an economy better than he got but it’s the market that’s feeling that and not the consumer. And how many votes does the market have?”

Even if he manages to put Latin America’s largest economy back on track, Meirelles would still face a host of other challenges. President Michel Temer’s scandal-plagued administration, of which he is arguably the most important cabinet member, has an approval rating of only 3 percent -- partly because Temer took over the job after the controversial impeachment of his predecessor.

Disappointed at Politicians

The two current front-runners in opinion polls are the leftist Lula, who is appealing a sentence on corruption charges that could bar him from running, and former Army Captain Jair Bolsonaro, a far-right congressman famed for his homophobic outbursts and hardline stance on law and order issues. More market-friendly and potential candidates, such as Sao Paulo Mayor Joao Doria and Sao Paulo state Governor Geraldo Alckmin, trail a distant third and fifth, respectively. Doria on Thursday invited leaders of the center-right DEM party over for dinner to talk about next year’s election.

Opinion polls also show that voters are disappointed with traditional politicians and seek a new generation of newcomers, a description the 72 year-old former central bank chief doesn’t exactly fit.

A successful candidacy requires a good platform, credibility, low rejection rates, name recognition, party alliances and votes, said Deputy Rogerio Rosso of Meirelles’ PSD party.
“Some of these ingredients Meirelles would need to strengthen when time comes,” Rosso said in an interview. “To be candidate he’d have to leave the ministry which wouldn’t be positive at this crucial moment.”

Meirelles is more optimistic, saying that the Brazilian population would reject the type of economic populism that helped trigger the recession and that a centrist, more technocratic candidate stand a good chance in next year’s race.

If Meirelles can’t overcome some of these challenges, he would still make a good running mate by lending some of his financial market credibility to another candidate, says Melo.

“He’s a good name as vice for Alckmin or Doria."