Brazil: Who Will Win The Brazil Election - And What Will They Do To Fix The Economy?

Last Updated: 24 October 2014
Article by Ricardo Aquino

Incumbent president Dilma Rousseff is virtually neck and neck with surprise pro-business contender Aecio Neves. But what has got the Brazilian people so energised about this election?

In 2001 the term BRICs entered our vocabulary, cited as the most promising up and coming investment destinations in the world – and Brazil was perhaps the most exciting of these. The prediction was a solid one, with Brazil's GDP hitting a magnificent 7.5% at the end of 2010.

But since then we've seen a major slowdown and widespread unrest, evidence of which marred the recent World Cup celebrations.

In the first round of the country´s presidential elections on 5 October, Rousseff secured 41.6% of the vote and Neves was behind with 33.6%. Now the economy is a central campaign issue for Worker's Party candidate Dilma Rousseff and Social Democratic Party candidate Aecio Neves, who will face-off against each other in the run-off ballot this Sunday 26 October. Growth for this year is forecast at just 0.3% and following two quarters of negative growth the economy is officially in recession.

The candidates

The challenges to the Brazilian market are many and doing business in the country is notoriously difficult. Yearly, PwC works with the World Bank and the International Finance Corporation (IFC) to produce a comparison of tax systems in economies worldwide. In the 2014 report, Brazil held its position as the most time-consuming tax regime in the world.

Tax professionals in Brazil are said to spend 2,600 hours a year complying with regulations, so it's little wonder businesses are crying out for change. Penalties can be aggressive and are not infrequent, given the endless number of tax regulations. To add to the burden, the government has assembled a huge tax surveillance system, increasing the pressure on tax payers.

While Neves has come forth with promises to make Brazil more competitive by overhauling the burdensome fiscal system, Rousseff is highlighting the impressive employment rate of around 95%. On top of that, wages have steadily risen and welfare programmes have helped to lift 40 million people out of poverty over the past decade. But Neves has promised voters that the welfare programmes won't be cut, blurring the opposition lines.

In terms of business, the current government's attitude is largely internally focused, with incentives mainly available for national manufacturing and construction companies. Rousseff's government has been keen to encourage consumers to buy more domestic products, reducing interest rates to stimulate spending at the beginning of her tenure, but in turn fuelling inflation. Tax incentives have also been extended to consumers on the price of new cars, motorcycles and white line goods.

Opinion is fairly evenly divided on Brazil's two polar candidates but Neves' stance on opening up the market and a return to an orthodox macroeconomics agenda has won over many from the financial sector. Behind the scenes he is being supported by former Central Bank director Arminio Fraga, whose solid reputation and recognition in the international market lends Neves even greater credibility. Former presidential runner Marina Silva has also thrown her weight behind the Neves campaign following his agreement to pursue a green environmental programme. But whether Silva's supporters will follow suit is another question entirely.

Public feeling

The Worker's Party has been in government for 12 years now, overseeing Brazil's boom time and now its stagnation. For Neves and Rousseff supporters alike, it seems that a fresh start is just around the corner.

Groaning under the weight of its reputation, Brazil certainly wants to deliver on its promise to one day be a global power house. Whatever its issues, it's an economy that multinational businesses can't ignore – and they haven't. Many multinationals have carved out a place for themselves in Brazil, including the likes of Fiat, who is developing the country's biggest manufacturing project in the north-eastern city of Goiania.

And we can't mention Brazil without touching on the recent World Cup and the 2016 Olympics. Many lessons will have been learned from hosting the footballing spectacle which will be applied to the next sporting event and, whatever the criticisms, it will spur on another round of investment in infrastructure – a major issue for Brazil, particularly if it wants to attract FDI and boost GDP.

Neves has thrown down the gauntlet to Rousseff, and is ready to revolutionise Brazil, targeting economic policy, the tax system, infrastructure and the energy sector. But Rousseff is rising to the challenge, also promising major tax reforms, greater investment in infrastructure, a new education programme and an expansion of her social policy programmes which have led to an emerging middle class.

Ultimately, in an election battle that is currently too close to call, one thing is certain; the Brazilian people are clamouring for improvements which will see their country an undisputed competitor on the world stage. Whoever the victor, change is certain because the country is at a turning point and the world is watching.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions