Brazilian president announces major government reshuffle

Brazilian President Dilma Rousseff announced a major government reshuffle Friday, axing eight ministries in a cost-cutting measure that also aims to end political paralysis and threats of impeachment.

At a time of recession, a massive corruption scandal and political instability, Rousseff said the shake-up would help put the world's seventh biggest economy and Latin America's biggest country back on track.

The reshuffle aims "to guarantee the political stability of the country which is needed to renew growth and strengthen relations between the parties and members of parliament who support the government," Rousseff, 67, said in the capital Brasilia.

Rousseff, who was narrowly elected last year to a second term, has already turned into a lameduck president, struggling to pass budget cuts and tax increases that her government says are necessary to help the floundering economy recover.

With the corruption scandal centered on state-oil company Petrobras engulfing leading figures of all political stripes, Rousseff has seen her popularity ratings sink to 10 percent and faced impeachment threats even from within her unruly coalition government.

The government shake-up appeared aimed at shoring up her fraying power base.
"Coalition governments need support from Congress. We live in a democracy," she said. "It's Congress, elected by the Brazilian people, that my government must have a dialogue with on getting support for ways and laws to speed up the exit from the crisis."

- Power shifts -

The changes cut the former 39 ministries to 31 in Brazil's sprawling bureaucracy.

"Today we are making a first and major step toward the reorganization of the federal public administration. We are beginning by reducing eight ministries," Rousseff announced.

A big winner in the reshuffle was the center-right PMDB which is Rousseff's most powerful, but not always reliable, partner in the ruling coalition, along with her leftist Worker's Party. Analysts said Rousseff boosted the PMDB's ministerial portfolio in hopes of winning support for economic reforms that have come under heavy criticism since she unveiled them a month ago.

They include spending cuts and the reinstatement of an unpopular tax on banking transactions.
Rousseff said what Brazil needs is political stability so that it can pursue the common goal of restoring economic growth. "We have to put the interests of the country above those of the parties."

The PMDB now gets seven ministries, up from six. That included changing the health ministry, which has the biggest budget and considerable political importance, from the Workers' Party to the PMDB.

The Workers' Party remains the biggest player with nine ministries.

But the reshuffle also reflected internal party shifts and the possibility of party founder and former president Luiz Inacio Lula da Silva seeking a return to power in the 2018 elections.

Defense Minister Jacques Wagner, a Lula ally, moved over to the politically key post of presidential chief of staff, replacing a Rousseff confidant.

"The president has decided on this reshuffle after pressure from the PMDB and from former president Lula with the hope of reducing the risk of impeachment proceedings," said Ricardo Ribeiro, an analyst at MCM consultants. "She is trying to make sure of the PMDB's support."

Source: AFP