February 5, 2023

This was the 8 years of government of Lula da Silva in Brazil

Read Time:6 Minute, 56 Second

(CNN Spanish) — Lula da Silva wants to return to government: the former president of Brazil between 2003 and 2010 will compete this Sunday in the first round of his country’s elections, in which he will face current president Jair Bolsonaro, who is seeking re-election.

To the 76 yearsLula has dedicated most of his life to seeking the presidency. He first ran for the Workers’ Party (PT) in 1989, when he was 45 years old, and lost in the second round to Fernando Collor de Mello. He tried again in 1994 and 1998, and lost both times, and in the first round, to Fernando Henrique Cardoso.

And in 2002, finally, he had his chance: he won the elections and became president of Brazil, obtaining re-election in 2006.

When he left the presidency in 2010, and was succeeded by his protege Dilma Rousseff -also from the PT- he had a level of 90% approval. But in the following years, the PT entered a crisis: Rousseff was dismissed in 2016 by the Brazilian Senator, and Lula was investigated, charged and convicted of corruption in the framework of Operation Lava Jato, which prevented him from competing in the presidential elections. 2018, which Bolsonaro won.

Brazil: what would a narrow result in the presidential election imply? 2:31

Now that Lula is running again, after the Supreme Court overturn his conviction in 2021, The entire campaign tries to water precisely in the eight years in which he was president.

What happened in that period?

previous context

At the end of the second presidency of Fernando Henrique Cardoso (1998-2002), Brazil, like other South American countries, was going through an economic crisis: after reaching a peak in 1997 of $883 billionnominal Gross Domestic Product at current prices had plummeted to US$510 billion in 2002.

At the same time the real had devalued to historical levelsthere were fears that the country would go into default —known as default—, as Argentina had just done, due to its debt of US$ 250,000 million, and in August of that year the International Monetary Fund offered a US$30 billion loan to deal with the crisis, one of the largest bailouts offered in the institution’s history.

Henrique Cardoso had managed to contain inflation with his Real Plan, but when he left the Government, unemployment, poverty and inequality continued to rise.

How are the elections in Brazil? 0:51

Economic growth

Months before the 2002 elections, Lula da Silva, who led in the polls, he promised to “prevent our internal debt from increasing and destroying confidence in the government’s ability to meet its commitments” if elected. “We are aware of the seriousness of the economic crisis. To resolve it, the PT is willing to negotiate with all segments of society and with the government,” said.

Lula won the elections in the second round with 61.27% of the votes, beating Henrique Cardoso’s protégé, José Serra, who achieved 38.72%, and assumed the presidency on January 1, 2003. In 2006 he won the re-election also in the second round, with 60.83%.

During Lula’s first presidency, Brazil, a country rich in natural resources and agricultural land, which is also in the process of industrialization, benefited from the high prices of raw materials and the government not only avoided defaulting on its debt but which managed an unprecedented GDP growth, hand in hand with the appreciation of the real and the increase in employment.

The Lula’s economic policy to accompany this growth in exports was celebrated at that time by the markets: reduce spending, pay the debt, reduce bureaucracy and favor entrepreneurs.

Brazilian President Luiz Inacio Lula da Silva speaks during a joint news conference with US President George W. Bush March 2007 in Sao Paulo, Brazil. (Credit: JIM WATSON/AFP via Getty Images)

With these measures, Lula sought to increase employment and tax revenues, while increasing the social spending on education and health. Thus, the 189 million Brazilians at that time (the figure amounts to 214 million today) would contribute to growth with their expanded consumption.

The result of the boom in raw materials had an impact on exports: in 2003 Brazil sold goods to China for US$4 billion, and the figure rose to US$46 billion in 2013, according to IMF data.

This, added to the economic policy of the Lula government, produced notable results: nominal GDP at current prices rose from US$510 billion in 2002 to US$2,210 billion in 2010, according to data of the World Bank.

While the index GINIwhich measures inequality (where 0 indicates equality and 1 inequality), was 0.58 in 2002 and 0.53 in 2009, and the unemployment it had fallen from 10.6% in 2002 to 9.4% in 2009.

The economic achievements, however, could not be maintained during the government of her successor Dilma Rousseff from 2011, and Brazil entered recession in 2015.

Fight against poverty

The two governments of Lula da Silva are also remembered for the measures to reduce poverty, which, added to the economic growth of the period, also had good results.

His most remembered program is Zero Hunger (Fome Zero), for which money and food transfers were made to ensure three meals a day to the most vulnerable population.

Thus, poverty measured by the daily income threshold of up to $2.15 (international poverty line) went from 11.7% to 6.1% in 2009. Measured according to the threshold of $3.65 (poverty line for lower-middle income economies), the drop was from 25% to 15%.

The role of Brazil in the world

Henrique Cardoso’s Brazil had already begun a period of greater global assertiveness in Brazil, which Lula expanded during his presidency, when the country becamer briefly the world’s sixth largest economy in 2011.

The relationship with Mercosur, a political and economic association between Argentina, Brazil, Paraguay and Uruguay, was among its pillars, but it also cultivated the group of emerging economies known as BRICS, made up of Brazil, Russia, India, China and South Africa.

Russia redirects trade to BRICS countries 1:12

Lula kept good relations with other presidents of left or center-left parties in the region, sometimes grouped under the banner of Socialism of the 21st century, especially with Fidel Castro in Cuba, Hugo Chávez in Venezuela, Rafael Correa in Ecuador, and Néstor Kirchner and Cristina Fernández de Kirchner in Argentina.

In this way, Lula was also critical of the international order: he was a promoter of the reform of the UN Security Counciland reacted to the global financial crisis of 2008 and 2009 saying that “we cannot become victims of the casino erected by the American economy.”

corruption scandals

The good economic results of the Lula da Silva government and the greater assertiveness of Brazil in the world contrasted with the growing accusations of corruption against numerous politicians from the PT and other parties in the coalition and the opposition, which would eventually lead to a political crisis. in the country.

The first alleged corruption scandal attributed to the Lula government was the so-called “monthly” (Monthly Payments), for which dozens of politicians in the government coalition were accused of paying monthly bribes to legislators starting in 2005 —using public funds— to secure their support.

Lula is released 5:09

The trial for the “Mensalão” started in 2012 after several years of investigation, and led to several convictions, including Joseph DirceuLula’s former chief of staff.

But the biggest blow to Lula’s legacy was related to his own indictment and conviction in the framework of Operation Lava Jato, an investigation into the payment of bribes involving the state oil company Petrobras and the construction company Odebrecht.

Lula da Silva was indicted in 2016 for corruption and money laundering, among other charges, and declared guilty in 2017. Following a series of appeals, he was sent to prison in 2018 to serve a 12-year sentence for corruption. But 19 months later he was released, and in 2021 the Supreme Court overturned his convictions for procedural defects and ordered the trials reopened.

Lula said at the time that the accusations against him were “fiction”, and his lawyers pointed out in a release that the case was politically motivated.

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