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Saturday, May 21, 2016

LatAm Viva 20-5-2016

FINANCIAL TIMES - Latam Viva: Your weekly briefing from the region
Brazil's new team
By Benedict Mander 
May 20, 2016
Has Michel Temer’s new “dream team” got what it takes to turn around Brazil’s flailing economy? One by one, the crisis-wracked country’s new president has been appointing respected technocrats to key positions after Dilma Rousseff was forced to quit power earlier this month. The finance ministry will be run by Henrique Meirelles, one of the most revered figures in Brazilian financial circles and the new government’s biggest hope. He will be supported in the central bank by its new president Ilan Goldfajn, formerly chief economist of Brazil’s largest non-state bank, Itaú Unibanco. Petrobras, which is mired in a corruption scandal that many see as the real reason for Dilma’s downfall, will be headed up by Pedro Parente, the former head of agribusiness group Bunge.
Many baulked at Temer’s decision to appoint an all-male, all-white cabinet for the first time since Brazil’s dictatorship, including seven ministers who have been linked to the scandal at Petrobras – three of whom are under formal investigation. But the unelected leader is performing a delicate tightrope act, balancing the contrasting demands of the various parties that brought him to power. Whether or not his new superstar economic team can come up with the goods will be crucial to him lasting the course until the 2018 presidential elections.
At least Brazil is making an effort to fix its problems. In Venezuela, Nicolás Maduro seems intent on plunging his benighted country ever deeper into crisis – despite his opponents’ best attempts to get rid of him. Continuing protests against the government have met with harsh treatment, stirring fears that Maduro will cling to power by any means available. Defying the opposition’s attempts to remove him from office via a so-called recall referendum, Maduro has declared a state of emergency to “stabilise our country and confront all the international and national threats”. In a sign of just how bad things are getting, Luis Almagro, the secretary general of the Organisation of American States who was previously foreign minister under Uruguay’s leftist former president, José Mujica, went as far as to call Maduro a “tin-pot dictator” this week.
Venezuela’s diplomatic relations with the rest of the world may be reaching rock bottom, but it is heartening to see that Argentina – which until recently was also led by one of the region’s more uncompromising leftist leaders, Cristina Fernández – is mending its relations with the rest of the world. Susana Malcorra, Argentina’s new foreign minister, told the FT this week that the Falkland Islands is no longer the defining issue in relations with the UK, as the new government of Mauricio Macri prefers to focus on more constructive issues like trade. Meanwhile, a number of officials from the former administration are facing corruption charges that are gathering force, with Férnandez herself among the most threatened of all.
Quote of the week
“For a moment, it looked like we had retrogressed to the start of the last century” - Luiza Nagib Eluf, a Brazilian columnist, reacting to the new cabinet of Michel Temer.
Statistical watch

The week in review
New Petrobras head bans political posts
 
Appointment of Pedro Parente at Brazil oil group hailed as market-friendly move
 
 
Anti-corruption tide reaches Argentina
 
Former president Fernández faces allegations of embezzlement, bribery and money laundering
 
 
Obama fights back against Trump over US trade deals
 
President levels his sights on threats to what he hopes will be one of his biggest economic legacies
 
 
Brazil pins hopes on Temer’s superstars
 
Country looks to economic strikers to carry weak team
 
 
Mexico is heading for recession, forecaster claims
 
Sales managers’ index shows four straight months of contraction
 
 
The ice finally begins to crack in Venezuela
 
The international community, including China, can play a useful role
 
 
Brazil taps veteran economist as central bank chief
 
Interim government is recruiting big names in effort to restore confidence
 
 
Firm economics help Bolivia buck commodities downturn
 
A diversified economy, solid fundamentals and now lithium promise a bright future
 
 
Argentina says Falklands no longer main issue in UK relationship
 
Foreign minister Susana Malcorra says trade and investment are more important
 
 
What is Venezuela’s recall referendum and how does it work?
 
Each part of complex process requires approval of government-dominated electoral council
 
 
Venezuela protesters fear Maduro will cling on at all costs
 
Opponents of socialist government seek removal of president via a so-called recall referendum
 
 
Mexico: political risk on the rise
 
Foreign investors and Mexicans alike are disappointed with the government’s unfulfilled promises
 
 
Fragile recovery in emerging markets
 
Policymakers would be ill advised to slack off reform
 
 
Brazil: Tales of everyday agony
 
The decline from emerging market star to struggling nation is taking its toll on Rio’s citizens
 
 
Stakes high for Brazil’s man with the money
 
New finance tsar leads cabinet trying to restore credibility on economic policy
 
 
FT LatAm Viva features commentary by the FT's Latin America team and stories fromacross the FT.

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