ESPIRITO SANTO GLOWS IN BRAZIL
The
recent wave of illegal strikes by public servants, especially among the
military, impeded by the 1988 Brazilian federal constitution to carry them out,
has caused a paradox in what concerns the economic crisis that plagues the
country. The state of Espírito Santo, which can now rejoice at being a lean
state with balanced finances, was the scene of one of the most violent scenes
of looting, robbery and death in a short space of time. Because of these “white
strikes”.
Until
recently, the state had been prominent in the national and international media
because it was one of the few federation states that had balanced finances,
paid the civil services and was not subject to prisoner rebellions. The
governor of the state was well-named and emerged as a potential presidential
candidate in 2018. Suddenly, the chaos, the situation changes and the state
that was an example of virtue came to live in the worst of worlds. The enemies
of power applied Machiavelli's maxim: "Let
evil be done all at once and good, the eyedropper."
Civil
society has split, one party supports the government, another says it's their
fault. The media that once venerated him now looks up the direction of the
crowd and support one or the other, depending on the quorum and messages posted
on social networks. A real pragmatism. It is true that the state government is
doing what has to be done, to offset the economy and managing the state with
responsibility, the moment is difficult for the whole country.
It does
not mean that the military and other public servants do not have the rights to
have their salary increases, they must have, however is not the time to claim
it. Now it´s unteneable, The structural reforms of the social security, the
ceiling of the public expenses, the easing of the labor laws will have to be
implemented by the Temer government to consolidate the macroeconomic bases.
Countries such as Portugal, Spain and Greece have gone through this fiscal
tightening situation and are starting to reheat their economies.
Brazil
can not allow itself to be carried away by populist politicians and profiteers,
with easy solutions to difficult problems, speeches that tickle the ears and
tend to deceive the unsuspecting with promises of quick social insertion,
abundant distribution of wealth and social demands fully met . This is the
ideal world, but not real. Until reaching the ideal pursued, it takes a lot of
work, planning, strengthening of education and an increase embrace of the
society on developing critical thinking in the sense of discerning the fake
from the feasible.
The
economic team of the presidente Temer is working hard to restore the country's
credibility in the world economic scenario. It is not an easy task to recompose
what has been destroyed in 12 years of abuse and public expense. In relation to
the dollar there is strong pressure from short-term investors, aggressive and
eager for quick returns, inject many dollars into the market which causes the
value of the American currency to plummet. At the right time, rumors of rising
interest rates in the US and uncertainties in China are pouring in for the
currency to begin to appreciate, and there, it's time to sell the bonds.
COMMODITIES
The price
of iron ore is rising in the market (USD 83.00 p / mt), however, still far from
the level reached in the golden years in 2011 (USD 190.00 p / mt). It is
important to note that this cost is modality "CFR" (cost and freight)
means that: transportation of the mines to the mill, port, clearance and
shipment on board the vessels is at the expense of the exporter. In this
segment and sale of agreements (CFR), VALE is very competent and has deep
expertise in this commodity market.
In
conclusion, Brazil needs to advance in the segments of technological innovation
to improve its industrial plants.
Support for incubators and startups, as well as investment flexibility for
micro and small companies, tends to relief some main dependence on the
commodity market.
By:
Zadock Zenas
Algarve.
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