2023-10-27 22:11:27
© Reuters. Lula’s talk about fiscal target is “boring”, says LDO rapporteur
The rapporteur of the LDO (Budget Guidelines Law) in the Chamber, deputy Danilo Forte (União-CE), stated this Friday (27.Oct.2023) that President Luiz Inácio Lula da Silva’s (PT) speech about possibly not achieving the fiscal target.
“President Lula’s statements about abandoning the fiscal target cause embarrassment to the minister [da Fazenda] Fernando Haddad, who has fought hard to achieve zero deficit after the approval of the economic agenda”, said the congressman.
Danilo Forte stated that he has been “defending” the need to change the fiscal target “within a political construction, with dialogue and transparency” since April.
“I have always defended a lean, feasible and realistic budget, which provides predictability to budget execution. This also involves voting on vetoes on the fiscal framework, which need to be assessed quickly,” he declared.
The federal deputy also said that Lula’s economic agenda has suffered “resistance” in the Legislature and that the delay in voting on the LDO was so that the government could “convincing the proposals of the economic team”.
Finally, he stated that he will remain at the Executive’s disposal to re-discuss “the real numbers of the economy within the perspective of a possible change in the primary result target”.
META FISCAL
On the morning of this Friday (Oct 27), President Lula stated that the government will “hardly” meet the target of zero fiscal deficit in 2024. He said that the financial market is “greedy” and that it does not want to start next year by cutting “ billion” of priority works and investments. He further declared that a deficit of 0.5% of GDP (Gross Domestic Product) would be “nothing” for next year.
“I know the disposition of the [Fernando] Haddad, I know about Haddad’s wishes, I know about my willingness, but I wanted to tell you that we will hardly reach the goal, especially because I don’t want to cut back on investments and works. If Brazil has a deficit of 0.5%, what is it? From 0.25%, what is it? Anything. Absolutely nothing”, declared the president in a coffee with journalists, held at Palácio do Planalto.
The federal government sent a PLOA (Annual Budget Bill) to Congress with revenues equal to expenses, but analysts estimate that it will not be possible to achieve the objective because the Union has increased spending and measures to increase revenues are viewed with skepticism due to the revenue potential. . The Ministry of Finance will have to increase revenues by R$168.5 billion.
Lula declared that to achieve the goal of eliminating the deficit it would be necessary to cut billions of priority works for Brazil. Contrary to what the PT member said, the government’s economic team continued, until now, to defend that it was possible to meet the fiscal objective.
“Everything we can do to meet the fiscal target we will do. What I can tell you is that it doesn’t need to be zero. We don’t need this, I’m not going to set a fiscal target that requires me to start the year by cutting billions in works that are a priority for this country”, declared the president.
According to Lula, even the financial market knows that the target cannot be achieved: “Often the market is too greedy and keeps demanding a target that it knows will not be met”.
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