Until recently, the Alemão favela, which has a population of 85,000, was controlled by drug traffickers where most of the 400,000 inhabitants did not dare venture out after dark because the area was so violent. The cable car will be free in the first month.
At the end of last year, the government of Rio launched a UPP (Pacification Police Unit) into the slum consisting of a military invasion by police and army soldiers. The area was wrested from drug lords and now the government is engaged in a long-term effort to reinsert itself into the slum.
The work on the cable car system was one of the most important projects in Lula’s Accelerated Growth Program (PAC). It cost slightly over 200 million reais (US$ 128 million).
The former president laid the cornerstone for the construction in 2008. It was in his speech at the beginning of the work on the Alemão cable car that Lula called Dilma Rousseff the “mother of the PAC” for the first time.
The cable car system has 152 cars (bondinhos) that can transport 30,000 passengers per day. It runs a little more than three kilometers from a subway station in Bonsucesso to the highest point in the slum where no public transportation is available due to the narrow, winding alleyways. People living at the top had to walk 20 to 30 minutes to get to public transportation. The system has six stations. Each cable car can transport ten people.
In her speech inaugurating the cable car system, Dilma called it a symbol of the way people’s lives can be improved by a government program. “We do not just build highways and dams. Since the Lula administration, the government has been investing in people. We do this to benefit the daily lives of common people,” declared the president.
According to Dilma, the cable car system is an example of the state taking on its real function, which is to spend public money to benefit the people.
“Brazil has this bad habit of abandoning part of the population. The people’s right to public services was being stolen. People who most need assistance were abandoned for years and years,” said Dilma.
Inflation
With fuel prices down 4.25% and food prices dropping 0.26%, official inflation as measured by the Broad Consumer Price Index (“IPCA”), halted a sharp upward tendency, rising only 0.15% in June, compared to 0.47% in May.
So far this year, cumulative inflation is 3.87%. For the last 12 months it is 6.71%, higher than the government’s inflation target of 4.5%, plus or minus two percentage points.
According to Eulina dos Santos, who heads the office of Price Indexes at the government statistical bureau (IBGE), fuel prices fell in June due to a lower price for ethanol, while food prices had their first decrease since September 2010.
“The price of ethanol dropped sharply due to a combination of lower demand in the past due to higher prices and a jump in supply as the new harvest went on market. Food prices, on the other hand, followed a slowdown in prices of commodities on international markets along with expectations of a bumper crop this year in Brazil that will be around 8% bigger than last year,” declared dos Santos.
Although official inflation as measured by the Broad Consumer Price Index (IPCA) has slowed down, monthly increases in the rate having gotten smaller for five consecutive months, the fact is that the IPCA rose 3.87% in the first half. That is the highest first half inflation rate since 2003, when it was 6.64%.
In the first half of 2010, inflation rose 3.09%.
According to Eulina dos Santos, who is the coordinator of the Price Index division at the government statistical bureau (IBGE), one of the reasons for higher inflation is that the prices of services have jumped. She points to the fact that as family income rises, people will continue to use services considered essential even though they are more expensive.
Thus, hairdressers and manicurist, for example, are charging more, but women continue to go to beauty salons. Another segment where prices rose is where the government controls or monitors them such as transportation, fuels and lottery tickets.
Cumulative official inflation for the last 12 months was 6.71%, which is the highest for a twelve-month period ending in July since 2005, when it was 7.27%.