President Jair Bolsonaro said on Monday that the government could freeze payments of states’ debt with the federal administration—adding that the move would go through after he discussed it with Economy Minister Paulo Guedes.
On Sunday, a Supreme Court justice gave an injunction suspending debt payments of the state of São Paulo for six months. Brazil’s wealthiest state was due to pay a BRL 1.2-billion installment today. In his ruling, however, Justice Alexandre de Moraes determines that the money saved must be used in actions to contain the spread of the novel coronavirus—and treat Covid-19 patients.
“The pandemic is a real and imminent threat, which will deplete the public health system of its operational capacity, with disastrous consequences for the population—measures of immediate effect are in order,” said the Justice.