Tebet defends Lula’s right to nominate Mantega to council – 03/30/2024 – Market

Minister Simone Tebet (Planning and Budget) defended the right of President Luiz Inácio Lula da Silva (PT) to nominate former minister Guido Mantega for positions on boards, whether at Vale or Braskem.

She also ruled out interference from the PT government in Petrobras.

“From the moment the president sees a partner in the figure of former minister Guido Mantega and tries to place him in the economy, in politics, that is, at his side, it is the president’s right,” said Tebet in an interview to CNN Brasil, which aired this Saturday (30).

“Seeing that the statute of state-owned companies does not allow it, the wrong thing would be if the president insisted. It was realized that he could not, the president stopped insisting. That is part of politics. […] I don’t think it’s a defect, it’s a virtue of President Lula, the ability to recognize his friends and want his friends on his side”, he added.

Lula worked to appoint Mantega as CEO of Vale, but ended up backing down. The strategy consisted of appointing him to one of the seats on the board of directors occupied by Previ, a pension fund for Banco do Brasil employees. This would pave the way for the former Finance Minister in the line of succession.

The news of the retreat was received with relief by investors, who feared political interference by the Lula government in the mining company. After the attempt failed, the government considered appointing him to Braskem’s board of directors.

To CNN Brasil, Tebet also said he did not see interference from the Executive in Petrobras’ decisions. The issue gained notoriety after the state-owned company’s board barred the payment of extraordinary dividends to shareholders, scaring away investors and causing the company to lose billions in market value.

“I do not see [interferência]. Talk to the president of Petrobras [Jean Paul Prates] regularly for other interests that we have, because we are part of the economic team, I don’t see this interference in Petrobras’ pricing policy”, he said.

“So much so that there was a lot of talk that [a Petrobras] it lost R$50 billion, which it recovered in 15 days, but no one saw that it had the second highest historical value in the series in recent years. So, Petrobras remains strong, with a very important, modern policy of revamping its history”, he continued.

In the interview, Tebet also spoke about the Central Bank’s current interest policy and argued that the 9% Selic level cannot be the floor sought by the monetary authority for the base rate at the end of 2024.

“[9%] It can’t be the floor. It can only be the floor if, from the second half of the year onwards, we start to show signs other than the signs we are giving. Because the Central Bank is not just analyzing food prices. The BC is keeping an eye on the government’s fiscal policy,” he said.

On the 20th, the Copom (Monetary Policy Committee) of the BC reduced the Selic for the sixth time in a row by 0.5 percentage points, from 11.25% to 10.75% per year, and was more cautious about the situation domestic and international.

In the minutes of the meeting, released on Tuesday (26), the collegiate stated that the uncertainty of the inflationary scenario requires more flexibility and, in the view of some members, this scenario could lead to a slowdown in the pace of interest cuts from mid-2019. year.

“If Brazil’s real interest rates fall, and the interest rate continues to fall slowly, I continue to have the highest real interest rate in the world,” said Tebet, adding that he agrees with the BC’s autonomy, despite criticism.

Asked if he defended the BC’s financial autonomy, Tebet replied that it depended on the conditions and signaled that he did not support the PEC (proposed amendment to the Constitution) currently being discussed in the Federal Senate, without the consent of the economic team.

“It is not the responsibility of the Federal Senate or the National Congress to discuss, for example, civil servant readjustments, the budget of a body that is not a body linked to the Legislative Branch”, he stated.

“I don’t think it’s a forbidden debate. We can discuss financial and budgetary autonomy as long as we have control of the economic team,” he said. “As long as each step is decided by mutual agreement between the Central Bank and the economic team, for example, at the CMN [Conselho Monetário Nacional].”

Regarding the government’s work to balance public accounts, Tebet stated that there is “at least until the middle of the year” no concern about discussing the review of the zero deficit target in 2024. For next year, he avoided committing to the promise of 0.5% surplus.

“The LDO [Lei das Diretrizes Orçamentárias] is coming [deve ser apresentada até 15 de abril]. We are going to present some proposals to the economic team and we will analyze together whether we will be able to set the target of 0.5% positive in the LDO, that is, to have a surplus, depending on a series of situations”, he stated.

The economy, however, has been viewed with pessimism by Brazilians, showed the Datafolha survey, carried out on March 19th and 20th. Polls also show a drop in Lula’s popularity.

For Tebet, the problem lies in better communicating to the public what has been done by the government. “We don’t know how to communicate,” she said.