Far-right Bolsonaro puts stamp on Brazil in first week

Brazil’s new president, Jair Bolsonaro, came out swinging in his very first week in office, introducing changes to remake his country around his far-right agenda — but proving less ambitious than expected on economic reforms.

Many measures announced since his investiture Tuesday reflected the 63-year-old former paratrooper’s desire to break with decades of center-left politics and embrace a nationalist vision of the sort espoused by his ideological ally, United States President Donald Trump.

Bolsonaro declared Brazil and the United States to be “friends” and said in his first post-inauguration TV interview he was open to looking at his country hosting a US military base, citing regional instability from neighboring Venezuela and its backer Russia.

He also issued decrees reducing protection of indigenous land rights and the LGBTQ community, and ordered that non-governmental organizations come under government monitoring.

His government announced it has launched a purge of government contractors deemed not to fully support Bolsonaro’s ultraconservatism.

And his pro-free-market economy minister, Paulo Guedes, said the government’s number-one priority was to tackle Brazil’s costly and unsustainable pension system.

Investors applauded the first bold steps, sending the stock market to a record high and strengthening the Brazilian real against the dollar.

– Confusion –

But on Thursday and Friday, Bolsonaro sowed some confusion on other issues when he spoke unscripted to journalists.

First, he spoke of a minimum retirement age that was well below what his economic team is mulling, undermining hopes that he was going to firmly tackle the pension problem that consumes a third of public spending.

Then he expressed wariness about a multi-billion-dollar planned tie-up between planemaker Embraer and US giant Boeing, sending the Brazilian company’s shares diving and calling into question his market-friendly campaign rhetoric.

And Bolsonaro also announced a tax increase contrary to a campaign pledge.

His chief of staff, Onyx Lorenzoni, hastily said Bolsonaro was “wrong” on the tax hike.

The other topics, however, were not fully explained by Bolsonaro aides, leaving the impression of a gap between the president’s ambitions and the ministers he has tasked with turning Brazil’s economy around.

Additionally, reports emerged Saturday of discomfort among top military brass at Bolsonaro’s idea of maybe having a US military base on Brazilian soil.

That dissent could reach Bolsonaro’s cabinet, where seven of his 22 ministers are retired military officers.

– ‘Simplified answers’ –

The impression left was that Bolsonaro’s first week was marked by moves aimed at appealing to his socially conservative base made up of evangelical Christian, pro-gun and pro-business groups, but with little underlying strategy.

“You get the idea that the government has been taken over by people who don’t have an idea what are Brazil’s most serious problems, who are tackling issues most of which aren’t important. When they do take on important issues, they have very simplified answers,” said Maria Herminia Tavares de Almeida, a political analyst at the University of Sao Paulo.

In terms of the outlook under Bolsonaro for Latin America’s biggest economy, “for the moment, it’s the honeymoon phase,” said Andre Cesar with the consulting firm Hold.

“The market is sometimes bipolar: euphoria today can turn into depression tomorrow.”

More announcements and decisions are expected from Bolsonaro and his team in the coming days and weeks as he seeks to put his stamp on Brazil while he enjoys very high approval ratings.

But observers said the real test will begin in February, when the new Congress starts work.

Bolsonaro’s conservative Social Liberal Party has only a tenth of the seats in the 513-member Chamber of Deputies, and the president will be relying on lawmakers from several parties reflecting his base to back him.

The political risk consulting firm Eurasia Group called that “his greatest challenge: to construct a working majority in congress to approve much-needed fiscal reforms.”