Brazil Announces 2nd Phase of Giant Infrastructure Plan

[Blue_Tires]

BRASILIA – The Brazilian government on Monday announced plans to build $880 billion worth of infrastructure between now and 2016 as the second phase of an economic stimulus program whose first phase is only half-completed.

The new plan, dubbed the Growth Acceleration Program 2, or PAC 2, emphasizes above all increasing the country’s energy production capacity, the construction of homes and necessary improvements for Brazil’s role as host of the 2014 soccer World Cup and the 2016 Summer Olympics in Rio de Janeiro.

PAC 2 was presented before some 1,200 invited guests at an event presided over by President Luiz Inacio Lula da Silva and the woman he hopes will succeed him, presidential chief of staff Dilma Rousseff, who is to step down this week to concentrate on her campaign for the October election.

Lula and Rousseff rejected accusations from opposition sectors, who said that the announcement merely hides electoral motives and the aim of improving the image of the ruling party presidential hopeful.

“PAC 1 and PAC 2 are a commitment by the Brazilian state to the redemption of this country,” Lula said. “Whoever arrives in the presidency will not be able to tear it up and do something else.”

However, he recalled that he himself baptized Rousseff as the “mother of PAC” and he added that without “the stubborn determination, perseverance and dedication” of the former guerrilla “perhaps it would not have been possible” to put together those programs.

http://www.laht.com/article.asp?CategoryId=14090&ArticleId=354531

[Judi Lynn]

1. This is tremendous! From the article:

Rousseff emphasized that the new program includes the construction of 2 million homes, which will be added to the 1 million scheduled in PAC 1, and these dwellings will contribute to reducing the country’s housing deficit by half.

“PAC 2 is not figures or a program of projects, but a plan to improve the lives of Brazilians,” she said.

Among the many projects included in PAC 2 is also a substantial increase in high-speed rail service that will be built between the cities of Rio and Sao Paulo.

Finance Minister Guido Mantega said at the event that PAC 2 will guarantee Brazil sustained economic expansion of around 5 percent annually, which will put the country “among a half dozen nations with the highest growth rates in the world.” EFE

Something to look forward to with real interest. Thanks, a lot.

Recommend.

[protocol rv]

2. I bet Dilma is very stimulated

This is an election move. A lot of that money is rolled up private money used to finance housing - so they piled on top the money they expect people to borrow to build their homes. it's a pretty good trick.

[Meshuga]

3. The fact is that these infrastructure plans are inevitable regardless who is president

Lula gave a lot of support for the Rio 2016 and Brazil 2014 events and deserves a lot of credit but the work of Sérgio Cabral, Eduardo Paes, João Havelange, Carlos Nuzman, and even the support of Sepp Blatter (president of FIFA who is a protégée of Havelange) were crucial to Brazil winning these events. The oil money from pre-salt is going to be big in paying for the infrastructure but now there is a huge fight in regards to the revenues being distributed to other states for other purposes.

But yes, this is a political move for the sake of elections. However, the next president will get credit for all the improvements the country will go through in the next 6 years regardless who wins.

[protocol rv]

4. Of course, and Lula is very smart indeed

I've been a big Lula supporter until he made the dumb comment about the hunger strikers while visiting Cuba.

And don't count the pre-salt eggs yet. They are going to have to borrow a lot of money to develop those oil fields, and oil has a tendency to become the devil's excrement. They'll have to be very very careful not to ruin things if the oil cash flow drives the currency value upwards. It'll kill the economy. Here in Venezuela we're now paying the price of an overvalued currency big time (although in our case the currency was inflated by the government on purpose, using short sighted exchange controls which landed us into a deep depression).