Dilma Rousseff Rides Economic Boom to Brazil’s Presidency

By 02 November, 2010

Former guerrilla leader Dilma Rousseff won Brazil’s presidential election in resounding fashion on Sunday and promised to stick to policies that have lifted millions from poverty and made Brazil one of the world’s hottest economies.

The ruling party’s candidate, Rousseff rode the huge popularity of President Luiz Inacio Lula da Silva to power, winning 56 percent of the vote with the opposition’s Jose Serra trailing on 44 percent.

Thousands of jubilant supporters danced on the streets of Sao Paulo and the capital Brasilia, waving red flags for both the Workers’ Party and the labor unions that form its base.

An emotional Rousseff said her government would seek to eliminate poverty by the end of her four-year term, and pledged to keep spending on welfare programs and infrastructure projects aimed at vaulting Brazil to developed-nation status.

But in a nod to investors concerned about Brazil’s finances, she said Brazilians would not tolerate a government that spent beyond its means and vowed to make public spending more efficient.

“I received from millions of Brazilians maybe the most important mission of my life,” she told a packed room of supporters in Brasilia, her eyes welling up with tears.

Flanked by her campaign manager and Lula’s former finance minister Antonio Palocci, Rousseff vowed to maintain Brazil’s hard-won economic stability and to respect existing contracts with private companies, a clear signal she is unlikely to stray from the market-friendly policies championed by Lula.

The election completed an unlikely journey that took Rousseff from jail and brutal torture by her military captors in the 1970s to become the first woman to lead Latin America’s largest economy.

A 62-year-old economist and former energy minister who leans left but has become more pragmatic over the years, Rousseff had never run for elected office. Yet she received decisive support from Lula, who plucked her from relative obscurity to succeed him.

“I think she will continue Lula’s work,” said Elizabete Gomes da Silva, a factory worker in Sao Paulo. “He governed for the people who needed him most — the poorest.”

Riding Lula’s Coattails

During Lula’s eight years in office, Lula’s stable fiscal policies and social programmes helped lift 20 million Brazilians, or more than 10 percent of the population, out of poverty.

The burgeoning middle class is snapping up cars and building houses at a pace never seen in Brazil before, helping make it a rare bright spot in the global economy.

That legacy was simply too much for Serra to overcome.

He mustered just enough support in the first round of voting on October 3 to force a runoff, and briefly closed in on Rousseff in polls. But she pulled away in the final two weeks as the focus shifted from her views on social issues such as abortion and back to Lula’s economic record.

Rousseff is Lula’s former chief of staff and promises to build on his successes by upgrading Brazil’s woeful roads, schools and other infrastructure as the country prepares to host the 2014 World Cup and 2016 Olympic Games.

She also seeks to exploit Brazil’s newfound offshore oil wealth and expand the state’s role in the energy sector while continuing to court private investment.

“Her government will focus primarily on solving Brazil’s bottlenecks,” Fernando Pimentel, a close adviser to her campaign, said in a recent interview.

Rousseff lacks Lula’s charisma or his clout in Congress, and some investors worry hers could be a status-quo presidency in which she fails to pass economic reforms that could reduce Brazil’s high cost of doing business.

Some also fear she could expand the state’s role too much in some areas while failing to rein in heavy budget spending, which has pressured the Brazilian real and helped make it the world’s most overvalued currency by some measures.

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From Jail to Presidential Confidant

Rousseff’s road to the presidency of the world’s eighth-biggest economy was hardly traditional.

The daughter of a well-to-do Bulgarian immigrant, Rousseff joined a leftist guerrilla group during the 1960s and resisted the military dictatorship of that era. She was then jailed for three years and repeatedly tortured with electric shocks.

Upon her release from prison in 1973, she moderated her views and ascended through a range of mid-level government posts in southern Brazil until Lula made her his energy minister, his chief of staff, and then his chosen successor.

Lula has acknowledged Rousseff lacks political experience but chose her because of her skill as a technocrat.

He says those qualities will be critical over the next four years as Brazil tries to bring its infrastructure in line with its ambitions as an emerging world power.

Lula, 65, was barred by the constitution from running for a third consecutive term, but the election of a close lieutenant without a long-standing base of her own may allow him to remain involved in policy after he steps down on January 1.

In her victory speech, Rousseff said she planned to “knock on Lula’s door” frequently over the next four years.

Rousseff survived a bout of moderate cancer last year. More recently, she overcame a last-minute corruption scandal that forced a former top aide to resign.

In coming days, Rousseff will be under scrutiny to see whether she makes difficult economic reforms a priority, and whether she fills top cabinet posts with members of the market-friendly wing of her Workers’ Party.

Rousseff’s ruling coalition will enjoy a wide majority in Congress that, in theory, should even give her the 60 percent of votes necessary to pass constitutional amendments.

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