If there is a need for run-off elections in the presidential and gubernatorial contests, the date has been set for October 29. Today, the first day that counts in the 2006 electoral calendar, the requirement that public opinion polls be registered with the Federal Election Board (TSE) goes into effect.

29 parties signed up with the TSE to dispute the elections. The last two parties to enroll were the Municipal Renovation Party (PMR) and the Socialism and Liberty Party (PSOL). October 1, 2005 was the deadline for registering parties and the party affiliation of prospective candidates.

The number of candidates will be smaller this year than in 2002, because only one third of the seats in the Senate will be at stake. Voters will be limited to one choice for senator on their ballots.

There will also be elections for 27 governors, 513 federal deputies, and 1059 state and (in the case of the Federal District) district deputies.

The exact total of voters currently stands at 123,247 and may still grow, since one can register to vote until May 3, which is also the deadline for people to change their address on the voting rolls.

The parties are authorized to hold conventions – where they will choose their candidates for president and vice-president, governor and vice-governor, senator and alternates, and federal, state, and district deputies – beginning June 10.

The candidates must be defined by June 30, the deadline for submitting the names and party coalitions.

Agência Brasil

According to the President, this is grounded on what has been accomplished during the first three years of his mandate. "I am not promising, I am guaranteeing the Brazilian people that we will have a Brazil developing much more in 2006."

Lula underscored that his Administration will strive to consolidate what has already been accomplished, because, according to him, "everything is in place for the Brazilian economy to grow."

He pointed out that the lowering of interest rates will permit more investments in 2006, creating more industries and more jobs. "More investments will mean more salaries, more purchases in stores, more orders for firms, and the development of Brazil as I and all Brazilians dream of," he added.

In the President’s view, the lowering of interest rates is not a momentary phenomenon. "We made some sacrifices so that we could control inflation. Now we have what I consider a steady policy of lowering interest rates, including the good news from the National Monetary Council that the BNDES long-term interest rate has been reduced from 9.75% to 9%," he affirmed.

Analyzing next year’s political contest, Lula said that the president’s role is not to allow it "to take over the administrative routine and the country’s development."

"The elections cannot and should not interfere with [the country’s growth]. In our favor we have the figures from the IBGE, the figures on the economy, and three years of experience and serenity that show the Brazilian people that the Administration remains unflappable, however serious the situation. After all, that’s the way an Administration should behave," he said.

The "Breakfast with the President" program was recorded on Christmas Day. Lula responded to Luiz Fara Monteiro’s questions over the phone from his home in São Bernardo do Campo, where he went to spend Christmas.

Agência Brasil

"I’m not promising, I’m guaranteeing the Brazilian people that Brazil will develop much more in 2006, with a more vigorous and more solid expansion," said President Lula in his last radio program of the year.

"I believe 2006 will be exactly what I’m telling you, a year in which industry will grow more, employment will increase, incomes will increase and I’m sure everything is going to be better in 2006," he added.

But private analysts are not so convinced following the deceleration of the third quarter, which has led them to downgrade growth estimates for 2005 from 3% to 2.5%, and 3,5% for next year, according to the Central Bank monthly poll among the leading businesses of the country.

Finance Minister Antonio Palocci stated Friday that the Brazilian economy is poised to expand 5% in 2006.

Mr. Lula has insisted that although 2006 is an election year, "elections can’t become an obstacle, should not become an obstacle, will not become an obstacle" for the government development plans.

"Obviously we’ll have a political dispute which always generates much discussion but I think the role of the president is to ensure that politics don’t dominate the daily management of government or the country’s development".

President Lula has still to announce if he will be running for re-election. His popularity has suffered severely following revelations of a network of illegal payments orchestrated by his Workers Party to buy support in Congress for the government’s legislative agenda.

President Lula insisted that Brazil is now a country with international credibility, "with its books in order" and with the necessary robustness "to cancel in advance its debts with the International Monetary Fund".

"We’re making decisions with no interference from the IMF or any other multilateral organization," he highlighted.

The latest Central Bank poll also indicates that business leaders expect lower interests since the reference rate began a steady four months slide last September from 19.75% to the current 18% and hopes of a further cut in January to 17.5%, probably ending 2006 at 15%.

But economic agents also believe that foreign direct investment in Brazil will remain stabilized in US$ 15 billion both in 2005 and 2006, contrary to earlier forecasts in excess of US$ 16 billion.

Mercopress – www.mercopress.com

Brazil’s Planning Minister, Paulo Bernardo, delivered the government’s proposal for next year’s budget to the president of the Senate, Renan Calheiros (PMDB party from Alagoas state), today.

Brazil’s total budget will be US$ 716 billion (1.7 trillion reais). From this amount US$ 350 billion (R$ 835 billion reais) will go to refinance the debt.  Another US$ 38 billion (90 billion reais) will be used to amortize the same debt. US$ 75 billion are reserved for the payment of interests.

“It is a balanced budget, in which we provide for a primary surplus of 4.25%,” Bernardo affirmed, just before a press conference to fill in details of the bill.

In a preview of some of the items included in the 2006 budget, he stated that priority was given to the social area.

The 2006 budget is 4.25% bigger than the one last year. When compared to the budget proposal approved by the Brazilian Congress, however, this amount represents a reduction of 32.9%.

Next year, the minimum wage will go up to 321 reais (US$ 135). This represents a dent of US$ 1.4 billion (3.4 billion reais) in the Treasury, since the minimum wage is 300 reais (US$ 126) today.

Bernardo highlighted the Family Grant program, which will be allocated around US$ 4 billion (9.5 billion reais). US$ 3.799 billion (9 billion reais) will be destined for family farming.

The health area will be assigned US$ 1.688 billion (4 billion reais) more than in 2005, for a total of US$ 15.611 billion (37 billion reais).

US$ 5.907 billion (14 billion reais) will be made available for infrastructure investments.

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A few arrogant and presumptuous colleagues might say that they have a “scoop” worthy of a Pulitzer Prize. Others, more modest, would claim that they are just revealing a “Punchinello secret”, in other words, something that everybody already knows. The truth, however, is that at the end of last week José Serra assumed, for the first time, that he is candidate to the Presidency.

Serra admitted having one thousand and one arguments to address the São Paulo electorate and explain that the commitment to remain until the end of his mandate as mayor of São Paulo has been broken by new facts. He is sure that voters will understand and even will encourage him to run for president of Brazil.

The Most Prestigious Name

It was during a meeting with friends, already on Saturday by dawn, in the São Paulo Jardins neighborhood, that the mayor announced his decision. He was holding the latest public opinion poll ordered by his party, the PSDB – the kind of survey that will not be published – informing that not only he is the favorite among the PSDB bases, but especially, that he would beat Lula in a second round.

Everybody knew about this, for weeks, but the numbers confirmation gave Serra the necessary oxygen to publicly assume his decision. For now, only a restricted public is aware, but, by the end of the month, more people will know that he will be the only candidate in his party’s convention, in December or January.

José Serra is sure that he is the name with better chances to beat president Lula, in his attempt of a second mandate. He will count on the support from the economic-financial elites, that seemed reticent when President Lula, last week, informed his intention of disputing the re-election.

Not because the elites imagine a full continuity of the current economic politics, in Serra’s hypothetical mandate, but precisely because the changes that he will promote in the current neoliberal model will reveal the importance of readjustments and alterations that president Lula did not want or could not undertake. Even in the financial speculation circles, Serra supplants Lula in terms of credibility. “Change to keep” might be his secret message to the potentates.

It remains to be seen whether the wind will really blow through these mountains, but everything seems to indicate that they will, especially because, the biggest representative of the mountains agrees with him. An agreement between Serra and Minas Gerais’s governor Aécio Neves is about to be celebrated.

Neves would dispute the re-election in Minas and would leave the Palácio da Liberdade (Freedom Palace) to become candidate to the vice-presidency in 2010, when Serra would have the chance of being re-elected.

After that, he would have the whole eight years ahead, to do what his grandfather (Tancredo Neves, who was elected President, but died before being inaugurated) wasn’t able to do, due to the laws of nature…

Crumbs, for the Dogs…

The government’s decision of giving the military a 13% wage increase plus 10% in the first semester of the next year didn’t go far enough to please the armed forces. First because the government’s commitment was to authorize 23% in March of this year and again in 2006. And also because they not only were but continue to be humiliated by the palatial technocrats, those who proclaim that they are been given much more than the men in uniform would deserve.

You can’t hide this: the economic team has been used as humiliation instrument of the military. The open wounds of 1964 up to the end of João Figueiredo’s government do not heal that easily. While gobbling toads standing in attention, the armed forces realized that the decision to deny them more than necessary readjustments had more profound reasons, and was taken at the top. The military complaints don’t come from the apathy of the Defense Minister and vice-president, José Alencar and much less from the indignation of the radical sectors of the extreme right.

The wages freezing is just a detail when compared to the reaction the current economic model provokes in the armed forces. After all, the Fernando Henrique and Luiz Inácio Lula da Silva’s administrations raped the national sovereignty. It is with that that the elites should start worrying…

Carlos Chagas writes for the Rio’s daily Tribuna da Imprensa and is a representative of the Brazilian Press Association, in Brasília. He welcomes your comments at carloschagas@hotmail.com.

Brazil’s Minister of Planning, Budget, and Management, Paulo Bernardo, affirmed yesterday that the 2006 Budget Guidelines bill (LDO) foresees real GDP (Gross Domestic Product) growth of 4% for this year and 4.5% in 2006 and that this latter value should be repeated as the outlook for 2007 and 2008.

The GDP represents the sum of all wealth produced in the country. The Minister participated in a public hearing in the Joint Congressional Budget Commission to talk about the LDO 2006 project.

According to Bernardo, the LDO project also forecasts that inflation, measured by the National Consumer Price Index (INPC), will amount to 5.69% this year.

For 2006, the rate is expected to be 4.16%, and in the two subsequent years, 3.92% and 3.99%, respectively.

The INPC is calculated by the IBGE (Brazilian Institute of Geography and Statistics).

Regarding exchange rate projections, the Minister of Planning said that the real is expected to end this year with the US dollar worth an average of R$ 2.64.

This value should rise to R$ 2.90 in 2006 and slightly above R$ 3.00 in 2007.

ABr