Good morning! Today, after major delays this year, the 2022 budget process is already underway. A highly-anticipated testimony in Brasília. The lasting effects of Operation Car Wash on the construction sector.
Brazil gets to work on next year’s budget
Congress is set to create its Joint Budget Committee to begin drafting the guidelines for the 2022 federal budget. Made up of 30 representatives and ten senators, the committee is in charge of analyzing the so-called budget guidelines law (LDO), proposed by the government.
Why it matters. The 2021 budget was only approved in April of this year, which prevented the country from making investments for months. With 2022 being an electoral year, there is an urgency to get things done on time.
Cap. Since 2016, the law states that federal spending can only increase year-on-year to match inflation. Despite these constraints, the government may get some leeway to the tune of BRL 38.9 billion (USD 7.5 billion), after overestimating pension expenses. That money could go on investments or congressional budgetary grants.
- These grants consist of money earmarked for projects chosen by lawmakers. They are a traditional horse-trading instrument in Brazilian politics, which President Jair Bolsonaro has taken to the...