Happy Friday! Today, Bolsonaro’s budget bill takes a step closer to full approval, but will face further delays. Usually the savior, agribusiness pushes Brazil into technical recession. Widespread hack in Santa Catarina exposes Brazil’s cybersecurity flaws … again.
Senate passes Bolsonaro’s budget bill
The constitutional amendment allowing the government to cap court-ordered debt repayments scheduled for next year passed with flying colors in a two-round Senate vote. Meanwhile, the upper house also approved a provisional decree creating the Auxílio Brasil cash-transfer program, replacing the world-renowned Bolsa Família scheme which has existed for 18 years.
Why it matters. Both moves are pivotal for the government to be able to dish out BRL 400 (USD 71) monthly benefit payments to vulnerable families next year.
- With low approval ratings and facing the risk of stagflation (more below), the president is placing all of his re-election hopes on the feel-good effects cash handouts could spark.
Precatórios. The amendment passed in the Senate allows the government to postpone payments of government IOU bonds known in Brazil as precatórios, freeing up over BRL 100 billion in the 2022 budget. Senators, however, made three substantial changes to the original draft passed by the House last month:
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