Teneo's Marconini: Brazil's Temer Is Best for Situation (Audio)

joins us. Now he's managing director for to New Intelligence in Latin America. In fact, he's in Sampaolo, Brazil. Mario, welcome to the show. Thank you so Mario. First of all, what is the mood? What is their action among people you talked to? Well, I think the first reaction is is relief, you know, because people are kind of set

up with the whole process. I mean, this has been nine months of a process since I got started, of course, since it was authorized the Speaker of the House back in December last year, so this is a long time for this. They went through the House, went through the Senate. He finally got to the end of it. So that's the first thing, is his relief and the hope that you can just begin to govern, you know, because since the second Mandate, which started in two thousand and fifteen,

we have not had much of a government. So it's just showed to me. It's so ironic because Brazil was flying high, you know, andso left, and then Da Silva took over, and the scene with with with certainly Carlos, so that the foundation was there for growth and low inflation and investment, the leta Silva carry things on. And what happened with rece was it her fault? Was it her lack of good policy or things just turn enough that she was the one who got caught with the

wrong chair or no chair when the music stopped. Yeah, I think I think unfortunately, I think it was utter incompetence. I mean, I think Lula, when he chose the successor, he could never have imagined that she could make such a mess out of the economy, and that she could be such a disaster politically as well, because you didn't speak to anybody, she didn't talk to Congress. You made enemies all over the place, including her own government, and

so it was. It was really difficult, and frankly, I think the order of things is that I think Lula did pretty well in the first mandate. The second half of him his mandate, you have the global financial crisis, and then they began, you know, with Kanjian policies, you know, growth policies to make sure that Brazil would would stay on course, and that worked. The economists even picked it up. But the fact is that when she came in in two thousand and ten, she basically thought that was that

was forever. You're just supposed to be spending money without any limits, and that was completely wrong. Obviously, you know, you cannot even do social policy just by dishing out of money without having it, and so this is really the main mistake. It was just just and that's the beginning of it. Not to mention all the charges that

were real, that were constitutional. You know the constitution that does talk about the responsibility for all the fiscal accounts on the part of the president, and it was all very clear, very institutional, very legal. But but that was the beginning of it. I think, Yeah, I think it was a shame and for a lot of people, I think it would have been natural for you to have the institutions, the the you know, the privatization or whatever you had with Cardoza, then you had Lulo with the

social inclusion, but understanding what macro economics was about. So what it was really a shame is how how the whole thing derailed was all of a sudden she forgot what macro economics was or didn't understand any of it and through the country under the bus. Basically that's what happened. Well, okay, so there were some would say these allegations of breaking budget laws. Other elected officials have kind of you know, they've fudged, they've cheated a bit, but they weren't brought

to impeachment by it. But as you say, people didn't like her and she was mismanaging the can of me. It's understandable how this could be used against her now. Michael Tamer, the vice president who's now president are Bloomberg story written from from some follow from Brazilia, says a lot of people view him as part of the same political establishment they have come to distrust. Is he the right guy or is it going to take yet another president to get Brazil back on track? No, I think

I think to get back on track he's been. I must say, I find that he is, uh, you know, the best you could get for for the current situation, considering all the ramifications and who happened to be at the vice presidency. The fact is he was never you know, a major part of Delmon's government. She didn't consult him,

He was not really involved in any policy making. And the fact is, since he has come in when she was suspended, you know, once uh, he got to that point in the impeachment process, he already came in with a total different view. Basically, you know, he wants to privatize, he wants to to to deal with the fiscal disarrangement that we have. He has been doing so. He has the right finance minister, he has the right Central Bank president.

And I think markets are still very optimistic, and I think they should be that at least we have the instruments with which to do what is necessary. I think the risk and the signpost you have to watch, of course, is going to be Congress, because a lot of the stuff you need to do, starting with a spending cap, which is something that he's been announcing since the beginning. There's a lot of support for it for those who understand economics and who can see what is needed for

the country. Uh, that has to go through Congress. So that's what we need to watch between now in October, we're going to have the campaign and then the municipal elections, so it's kind of difficult to to vote, but I think, you know, until the end of the year, I think he will be able to vote on a spending cap, which is which is going to be unbelievable actually as a signal of commitment with fiscal response, fability Marco Marcot Needi,

thank you so very much. Fiscal responsibility what Brazil needs now joining us from latam uh in a tornado intelligence This is Bloomberg