January 2, 2019 / 4:49 PM / a year ago

Brazil's new far-right government issues decrees across sectors

BRASILIA, Jan 2 (Reuters) - Brazil’s new President Jair Bolsonaro set to work quickly on Wednesday, with his administration issuing decrees affecting the economy, agriculture and society, while forging closer political ties with the United States.

Bolsonaro, a former army captain and seven-term congressman, won elections in October and was sworn in on Tuesday as Brazil’s first far-right president since a military dictatorship gave way to civilian rule in 1985.

Fulfilling a campaign promise to his staunch supporters in the farm sector, Bolsonaro decreed that indigenous land claims, a source of bloody clashes on Brazil’s agricultural frontier, would be decided by the Agriculture Ministry.

The gift to the powerful agribusiness sector enraged environmentalists already worried by Bolsonaro’s plans to loosen protections of the Amazon rainforest and remove Brazil’s support for the Paris Agreement on climate change.

The new president was elected on a platform to clean up Brazilian politics, and he put the country’s top anti-corruption figure, Sergio Moro, in charge of a Justice Ministry beefed up to fight graft and battle organized crime.

Moro, a former federal judge who spearheaded the “Car Wash” corruption trials that put former leftist President Luiz Inacio Lula da Silva and other high-profile politicians in jail, said on Wednesday he would help usher in a new era of law-and-order.

“The top mission given to me by the president was clear: end impunity for corruption cases and combat organized crime to reduce violent crimes,” Moro said after being sworn in.

The administration would propose an ambitious anti-crime bill to Congress next month that would stiffen prison sentences, Moro said.


Bolsonaro met this week with U.S. Secretary of State Mike Pompeo, President Donald Trump’s envoy to Tuesday’s presidential inauguration, who said the United States and Brazil will jointly defend democratic values in the region.

“We have an opportunity to work alongside each other against authoritarian regimes,” Pompeo said on Wednesday after discussing Venezuela with Brazil’s new Foreign Minister Ernesto Araujo, who was picked by Bolsonaro for his admiration of Trump’s conservative nationalism.

Bolsonaro’s rise to power culminates a swing to conservative rule in Latin America that has isolated leftist-ruled countries such as Venezuela, Cuba and Nicaragua.

While Bolsonaro surprised Brazil’s political establishment by surging to victory over a leftist coalition led by Lula’s Workers Party, he takes office with the lowest approval rating of any new Brazilian president, according to a Datafolha poll Tuesday.

That suggests he will have an uphill battle to enact his agenda of austerity measures to bring down an unsustainable budget deficit of about 180 billion reais ($47.31 billion) that has investors worried.

Markets, however, are optimistic that Bolsonaro’s economic team, led by former investment banker Paulo Guedes, will succeed in passing reforms needed to reduce the deficit and restore confidence and growth to a slow-moving economy.

One of Bolsonaro’s first steps was to decree a less-than-expected increase to the minimum wage for this year, to 998 reais ($260) a month from 954 reais.

The real currency strengthened 1 percent by midday Wednesday and the Sao Paulo Bovespa stock index rose 2 percent.

Preferred shares in the country’s largest utility Centrais Eletricas Brasileiras SA jumped over 10 pct after new Energy & Mines Minister Bento Albuquerque said the company would be partially privatized.

Doing even better was gun manufacturer Forjas Taurus SA whose shares rose 27 percent to 5.1 reais on Bolsonaro’s plan to ease gun controls, to help Brazilians arm themselves in self defense against crime.

In his inauguration address on Tuesday, Bolsonaro said his election had freed Latin America’s largest nation from “socialism and political correctness.”

($1 = 3.8048 reais)

Reporting by Ricardo Brito, Lisandra Paraguassú, Mary Milliken, Gabriel Stargatter, Brad Brooks and Carolina Mandl Writing by Anthony Boadle Editing by Frances Kerry

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