Haddad presents first concepts for the economic system
- December 15, 2022
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Recently appointed to assume the Ministry of Finance by President-elect Luiz Inácio Lula da Silva, former São Paulo mayor Fernando Haddad presented this Tuesday, December 13, some guidelines for economic policy over the next four years.
In addition to reinforcing the commitment of Lula’s campaign to “bring the poor into the budget”, he demonstrated, in an interview with journalists, that he intends to balance public accounts and have a partnership with the private sector in investments and credit.
Haddad also said that he intends to present a new fiscal framework next year and that he intends to encourage the granting of credit by the private sector, taking advantage of the profusion of fintechs in recent years.
Tax reform is also a focus of the new government, according to Haddad. The initiative was reinforced with the arrival of Bernard Appy, appointed today as Special Secretary for Tax Reform.
Appy was Secretary of Economic Policy at the Ministry of Finance and headed the Extraordinary Secretariat for Economic-Fiscal Reforms in the first Lula administration.
He joins Gabriel Galípolo, nominated to be executive secretary of the Treasury portfolio. Galípolo was president of Banco Fator between 2017 and 2021 and also headed the Economic Advisory of the Metropolitan Transport Secretariat of São Paulo in 2007.
O NeoFeed selected some excerpts from the main points addressed by Haddad. Check out 20 sentences from the new finance minister about what he thinks about the economy:
“I have always been critical of the Spending Ceiling. In the 2018 campaign, he said that it was not a reliable rule and that it jeopardized the fiscal framework. The Fiscal Responsibility Law, despite the criticism, was largely complied with by governments, including ours. It is not enough, but it was practically the only rule and it supported public accounts.”
“The fiscal framework that we intend to send needs to have the premise of being reliable and sustainable. It needs to guarantee the financing of priority government programs and guarantee the sustainability of the public debt, making fiscal responsibility compatible with social responsibility.”
“Regarding the new fiscal framework, we are still receiving proposals. The National Treasury made a proposal, the transition group made a proposal. The next Congress takes over in February, so we will have time to study the proposals and validate them with the President of the Republic.”
“I do not intend to use the deadline established by the PEC [até o final do ano]I will try to deliver as soon as possible, because I understand that this will strengthen the Tax reform debate.”
“In 2003, we presented a large credit agenda for Brazil, which was quite effective, without compromising the balance of public accounts, with credit expansion programs carried out correctly.”
“The world has changed a lot since 2003, especially in technology. There are now players that did not exist before, a regulation in the world that did not exist before. Today we have strong banks that don’t have branches.”
“We are going to work to ensure more competition and flexibility from technology instruments that did not exist. It has a profusion of agents that will help to democratize credit, to make the borrower’s interest rate drop. We can count on a new world in the democratization of credit.”
“The agenda of public banks is different. In agricultural credit, a large percentage is with Banco do Brasil. Caixa is fundamental for social programs, for administering the FGTS and for Minha Casa Minha Vida. The names of the new bank presidents will be defined by President Lula.”
“We think we can wean the big companies, because there is no need for support for those that manage to access credit on cheaper terms.”
role of the state
“There are investments that require the participation of the State. If you’re going to build a subway, the account doesn’t just settle with the capital market. The idea of PPPs is precisely this.”
“Minha Casa Minha Vida is also a partnership. In the first range, people do not have income to buy real estate. With government subsidy, we manage to provide the low-income population with quality housing.”
“The private sector helps the state not to make mistakes.”
“The PEC was being formatted by the transition team when I arrived. I’ve been following the transitional government for two weeks now. I was invited to be a minister there in Egypt [na COP 27] and i was announced on friday [dia 9]🇧🇷 I have had the authority to speak about the economic area for four days now.”
“The transition team made an account, about which budget needs to be approved so that Lula has, next year, the same value that Bolsonaro had this year in terms of expenditure as a proportion of GDP.”
“The Bolsonaro government authorized a series of expenses throughout the year, during the election period, in a hasty manner. It was necessary to accommodate a lot of things that were not foreseen at the beginning of the year.”
“The value of the PEC is to maintain benefits for those affected by last-minute electoral decisions.”
“A fine-tuning is being done by Congress. Let’s see what the final decision will be, because a PEC does not need to be sanctioned by the president.”
“It is only possible to evaluate the team when it is assembled. Our executive secretary never participated in a meeting of the PT or another party, and until the other day he chaired a bank.”
“About Bernard Appy, if you consult the market, those for whom you [repórteres] eventually call, I doubt anyone has any technical constraints on how they see the world.”
“I hope to be able to announce the top tier of the team by the end of next week.”