Tensions have been running high since then and will remain elevated until January 1, when Lula will be inaugurated.
In a highly divisive and violent election, Lula’s promise to protect democracy and reduce poverty galvanised left-wing voters. He was also able to lure moderates by picking a centrist running mate, Geraldo Alckmin.
Meanwhile, Bolsonaro’s mishandling of the COVID-19 pandemic and unfounded attacks on the legitimacy of Brazil’s electoral system alienated large sections of the country’s population.
Piqued by the result, Bolsonaro’s Liberal Party (PL) recently petitioned Brazil’s electoral court to reject ballots from 280,000 voting machines. The request was rejected due to insubstantial evidence and attention has now turned to the numerous tasks facing the incoming president.
“I believe the Brazilian economy will face a major challenge in 2023,” worries Ernesto Bicaleto, a nurse working in the Brooklin Novo neighbourhood of São Paulo.
Compared with Lula’s first two terms in office, from 2003-2010, the current economic outlook is gloomy. Inflation is hovering at 6 percent despite the central bank’s decision to raise interest rates to 13.75 percent in August, extending an 18-month tightening cycle.
High borrowing costs look set to constrain investment and consumption, just as concerns over an impending global recession have started to undercut commodity markets. The price of Brazil’s key exports (soybeans, oil and iron ore) are all expected to edge down next year.
By contrast, Lula’s previous presidency coincided with a long rally in global commodity prices. With other resource-rich countries in the region, Brazil’s economy soared. High-budget surpluses facilitated large-scale infrastructure investment. Welfare programs (such as the Bolsa Familia cash transfer scheme) were also expanded and unemployment fell.
Owing to favourable growth dynamics, Brazil’s gross debt to gross domestic product (GDP) ratio declined from 77 to 62 percent during Lula’s tenure.
After the global financial crisis, however, economic activity and fiscal discipline softened. This was particularly true during the presidency of Dilma Rousseff – Lula’s successor.
Precarious economic footing
Towards the end of his presidency, Bolsonaro’s decision to raise cash handouts and cap taxes on gasoline and electricity (to combat the cost of living crisis) only added to Brazil’s debt burden.
The new gov’t will have to deal with high borrowing costs and a global economic slowdown which is hitting prices of commodities, a key revenue for Brazil [File: Vanderlei Almeida/AFP]
Today, the country’s debt-to-GDP ratio is almost 90 percent. High debt loads carry an elevated interest burden, which limits public spending on things like education and healthcare.
Admittedly, inflation has tailed off in recent months. However, Brazil’s economic footing remains precarious. The president-elect will need to walk a fine line between pursuing growth reforms and reducing public spending.
Lula’s Workers Party (PT) has already hinted at maintaining the recently approved boost to social welfare.
“But this won’t last forever”, warns Nelson Barbosa, Brazil’s minister of finance from 2015-16.
“Assuming growth rebounds towards the end of next year, support measures will have to be rolled back. That said, the focus will be on stimulating growth and then reducing debt.”
Given Lula’s emphasis on public investment, PT economists have raised objections to Brazil’s current fiscal rules. In particular, the government’s spending ceiling, which limits budget increases to inflation, has drawn fierce criticism.
“This fiscal protocol is not fit for purpose. It should be replaced by a new rule which allows spending to grow in real terms and is based on a long-term fiscal scenario for public debt,” Barbosa said.
PT has also highlighted the need to simplify Brazil’s labyrinthine tax system. Some analysts expect Lula to retain parts of Bolsonaro’s policy proposals, such as unifying regional sales duties into one national value-added tax. E
Elsewhere, PT are thought to be considering a more progressive tax regime that would expand exemptions for low-income individuals.
Away from public finances, PT previously pledged to repeal Brazil’s 2017 labour reform bill, which weakened workers’ bargaining power. In recent months, however, the party has moderated its stance.
According to Marcos Casarin, chief economist for Latin America at Oxford Economics, “Lula may try and adjust the bill by reintroducing mandatory funding for unions. He may also try to raise the minimum wage, but that would cost him politically.”
During the election campaign, other talking points included enhanced pay for “gig” workers. For Brazil’s vast informal economy, estimated at 40 percent of the country’s employed workforce, COVID-19 amplified social vulnerabilities.
To assist these workers, Mr Marcos pointed out that “a tax indexed to app companies’ revenue could be explored”, but stressed that, “while these measures would provide a fiscal lift, they are not a priority for Congress”.
Treacherous terrain
Pro-Bolsonaro parliamentary forces are widely expected to try and stall Lula’s agenda [File: Amanda Perobelli/Reuters]
In the first-round elections on October 2, the far-right strengthened its hold on the country’s national Congress. Voters re-appointed all members of the chamber of deputies and one-third of the Senate.
In the former, Bolsonaro’s PL won 99 seats, the largest single-party block. In the latter, PL and its right-wing allies secured 19 of the 27 seats up for grabs.
Pro-Bolsonaro parliamentary forces are now widely expected to try and stall PT’s agenda in the coming years.
“The terrain is very treacherous for any political leader… passing economic reforms will be an uphill battle,” noted Alfredo Saad-Filho, professor of international development at King’s College London.
Lula’s politics, in turn, may be forced to shift more to the centre.
“Lula is arguably the most talented politician of his generation and if anyone can heal the country’s fissures it’s him. But given the political landscape, he will have to make big concessions over the next four years,” added Saad-Filho.
“I’m not optimistic about progressive reform.”
Financial markets have so far been sanguine about Lula’s return. On December 14, Brazil’s incoming finance minister, Fernando Haddad, calmed market jitters by playing down the prospect of excessive public spending.
At the same time, Lula was forced to construct a broad political church against Bolsonaro.
This, together with stiff parliamentary opposition, will likely be reflected in a moderate approach to economic policy.
The upshot is that Lula will not be able to ride on the coattails of a 2000s-era growth spurt. He is also facing growing pressure to de-carbonise Brazil’s growth model and to reassert greater government control over Petrobras, the state-backed energy company.
In short, he faces enormous challenges.
But according to Mr Biclaeto, the nurse from Sao Paulo, Lula’s most enduring legacy won’t be economic. Rather, it will be “the victory of democracy”.
Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.
Here’s a timeline of key events in the bread price-fixing case.
Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.
Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.
Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.
Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).
Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.
June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.
Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”
Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.
July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.
Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)
TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
VANCOUVER – Supervised injection sites are saving the lives of drug users everyday, but the same support is not being offered to people who inhale illicit drugs, the head of the BC Centre for Excellence in HIV/AIDS says.
Dr. Julio Montaner said the construction of Vancouver’s first indoor supervised site for people who inhale drugs comes as the percentage of people who die from smoking drugs continues to climb.
The location in the Downtown Eastside at the Hope to Health Research and Innovation Centre was unveiled Wednesday after construction was complete, and Montaner said people could start using the specialized rooms in a matter of weeks after final approvals from the city and federal government.
“If we don’t create mechanisms for these individuals to be able to use safely and engage with the medical system, and generate points of entry into the medical system, we will never be able to solve the problem,” he said.
“Now, I’m not here to tell you that we will fix it tomorrow, but denying it or ignoring it, or throw it under the bus, or under the carpet is no way to fix it, so we need to take proactive action.”
Nearly two-thirds of overdose deaths in British Columbia in 2023 came after smoking illicit drugs, yet only 40 per cent of supervised consumption sites in the province offer a safe place to smoke, often outdoors, in a tent.
The centre has been running a supervised injection site for years which sees more than a thousand people monthly and last month resuscitated five people who were overdosing.
The new facilities offer indoor, individual, negative-pressure rooms that allow fresh air to circulate and can clear out smoke in 30 to 60 seconds while users are monitored by trained nurses.
Advocates calling for more supervised inhalation sites have previously said the rules for setting up sites are overly complicated at a time when the province is facing an overdose crisis.
More than 15,000 people have died of overdoses since the public health emergency was declared in B.C. in April 2016.
Kate Salters, a senior researcher at the centre, said they worked with mechanical and chemical engineers to make sure the site is up to code and abidies by the highest standard of occupational health and safety.
“This is just another tool in our tool box to make sure that we’re offering life-saving services to those who are using drugs,” she said.
Montaner acknowledged the process to get the site up and running took “an inordinate amount of time,” but said the centre worked hard to follow all regulations.
“We feel that doing this right, with appropriate scientific background, in a medically supervised environment, etc, etc, allows us to derive the data that ultimately will be sufficiently convincing for not just our leaders, but also the leaders across the country and across the world, to embrace the strategies that we are trying to develop.” he said.
Montaner said building the facility was possible thanks to a single $4-million donation from a longtime supporter.
Construction finished with less than a week before the launch of the next provincial election campaign and within a year of the next federal election.
Montaner said he is concerned about “some of the things that have been said publicly by some of the political leaders in the province and in the country.”
“We want to bring awareness to the people that this is a serious undertaking. This is a very massive investment, and we need to protect it for the benefit of people who are unfortunately drug dependent.” he said.
This report by The Canadian Press was first published Sept. 18, 2024.
