Olympics

VICE News

SÃO PAULO — Activists in Brazil say a proposed law defining terrorism will criminalize protest movements, including those looking to use media attention on the 2016 Olympics in Rio de Janeiro to highlight social injustices and push for reforms.

The bill, authored by President Dilma Rousseff’s office, was amended on its way through the lower house of Congress to add specific exemptions for social movements, but these were removed when it sailed through the Senate last week. It now heads back for a final reading by Brazil’s deputies, and would require final approval by the president.

Supporters of the bill argue Brazil needs legislation to define and fight terrorism, though experts charge that the move stems from pressure from the U.S.-led anti-terrorism body — the Financial Action Task Force, or FATF — amid fears of sanctions that could exacerbate the country’s recession.

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Translation of blog piece for BBC Russian

In exactly a year’s time, the world’s biggest sporting event – the Olympics – will kick off in Brazil’s Marvellous City, in what is South America’s first chance to host the unrivalled celebration of sport.

Despite Brazil’s experience in hosting major sporting events, the numbers for Rio 2016 are still daunting:

Nearly 11,000 athletics from 205 National Olympic Committees will be taking part in 19 days of competitions in 33 venues across four city clusters.

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VICE News

RIO DE JANEIRO — The prospect of hosting the 2016 Olympic Games was presented to the people of Rio de Janeiro as a chance to showcase the city to the world, generate investment, and improve the lives of its residents — but two recent events illustrate how the combination of construction for the games and a worsening housing crisis has prompted accusations that Olympic preparations are riding roughshod over Rio’s most vulnerable inhabitants.

On Tuesday, police evicted squatters from an abandoned apartment building that onetime Brazilian billionaire Eike Batista had leased from the Flamengo soccer club, hoping to convert it into a swanky hotel for the Olympics before the collapse of his oil and mining empire.

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SÃO PAULO — Robin Williams, who died on Monday aged 63, wasn’t just loved in America, the UK and the rest of the English-speaking world. His genre-defying performances were adored worldwide, and Brazil is no exception.

Dead Poets Society and Mrs. Doubtfire — whose local title, Uma babá quase perfeita, translates as An Almost-Perfect Nanny  — were particular hits here.

Many in Brazil have mourned his passing with genuine outpouring of emotions, and heaped unending praise on the energetic funnyman.

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Anadolu Agency

SÃO PAULO — Brazil now boasts the most multi-millionaires in Latin America and is ranked tenth in the world, according to a study reported by local media.

The study by Johannesburg-based wealth consultancy New World Wealth also showed that São Paulo, Brazil’s biggest city and business center, is the world’s 17th for multi-millionaires, defined in the report as having more than $10 million in net assets.

Currently the world’s seventh largest economy, Brazil has 10,300 multi-millionaires, of which 4,400 are concentrated in São Paulo and a further 2,200 in Rio de Janeiro, putting the “Marvellous City” in 27th position globally.

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Anadolu Agency

SÃO PAULO – Preparations for the 2016 Summer Olympics in the Brazilian city of Rio de Janeiro are the ‘worst’ ever seen, an International Olympic Committee (IOC) vice president said on Tuesday.

The majority of the Olympic events, which begin in August 2016, will be held at four sites around Rio, but construction of some of the venues has not yet started, the IOC said.

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Federal troops will begin to occupy the complex of 15 favela communities that make up the Complexo da Maré in the north of Rio de Janeiro on Saturday, the chief of the city’s Military Command Center of Operations confirmed in a press conference on Thursday.

The ten-square-kilometre swathe of favelas is nestled near the city’s Galeão International Airport alongside a number of major thoroughfares, including fast transit systems to the centre, where the Maracanã World Cup stadium is located, and to Barra da Tijuca, the city’s main Olympic site.

The Maré area is also thought to be home to around 130,000 inhabitants.

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On the face of it, Thursday brought some sorely-needed good news for Brazil.

The country’s national office of statistics, the IBGE, confirmed the country’s economy had bounced back, if only modestly, with better-than-expected results for the last quarter of 2013 and the year overall, achieving annual GDP growth of 2.3% – more than the US, the UK and other advanced economies.

Brazil Finance Minister Guido Mantega. Photo: Marcello Casal Jr/Agência Brasil

Brazil’s Finance Minister Guido Mantega said the figures were a ‘surprise’ for the government. Photo: Marcello Casal Jr/Agência Brasil

After negative growth in the third quarter of 2013, some economists feared Brazil could be facing a technical recession.

In the end the fourth quarter rebounded with 0.7% growth, buoyed by strong consumer spending, investment and 2.0% growth in the country’s services industry, upon which 70% of the economy relies.

The surprise uptick in the economy is a much-needed boost for the government of President Dilma Rousseff, who is seeking re-election in this October’s general elections, and has been suffering from a compounding of anti-government protests, World Cup concerns, political scandals, and more recently problems with water and power supplies – all of which have seen approval ratings for both Ms Rousseff and her government slide.

Finance Minister Guido Mantega told reporters the positive fourth quarter results had come as a surprise, saying 2013 had seen “quality growth spurred among other things by investments”.

It was certainly better than in 2012, when Brazil grew just 1%; however, the general feeling among analysts surveyed by Anadolu Agency appears to be that the results are mildly encouraging at best, and indeed, nobody is expecting growth to return to the impressive 7.5% seen in 2010 or even to the 4% average seen over much of the last decade, when the economy was boosted by China’s seemingly unstoppable demand for Brazilian commodities.

Over the past decade, Brazil has used available cheap and plentiful external finance options to catalyse a consumption boom, which led to the ‘feel-good factor’ experienced particularly by new middle-class Brazilians in recent years.

But it also led to significant consumer debt and over-target inflation. Now China is no longer buying such vast quantities of commodities, and the global economy is still struggling to recover.

Growth grounded?

Mr Mantega said industry in Brazil was suffering from a “lack of dynamism in the global market”, but was upbeat about the future, defending Brazil as now being in better shape to tackle international instability.

However, once touted as a star among emerging markets, today Brazil’s economic prowess is being described more than ever in shades of ‘fragile’ and ‘vulnerable’, and the IMF recently labelled Brazil as one of the most susceptible emerging economies.

In truth, Brazil has always been a vulnerable economy.

Although international instability, currency volatility, and dwindling demand from China certainly play a role, economists say internal problems – substandard infrastructure, rampant consumer debt and dismal confidence in both the country’s market and policymakers’ decisions at the Central Bank – are also hampering growth and believe Brazil now faces a long period of uninspiring annual growth of around 2%.

I’m sceptical about the economy’s future. We have major issues with infrastructure and the labour market and reforms are sorely needed,” Fernando Chague, professor of economics at the University of São Paulo (FEA-USP), told Anadolu Agency.

According to the USP economist, Brazil failed to implement the necessary fiscal changes in the last decade, while the going was good, and grew largely “in spite of the government”.

“There’s no political strength to do so now, and the uncertainty we are facing is not good for the economy,” Professor Chague warns.

Neil Shearing, chief emerging markets economist at London-based macroeconomic research company Capital Economics says Brazil could in theory get back to annual growth of four percent: “First, economic reform would have to take place to rebuild the supply side of the country’s economy, but politically this would be very difficult at the current time.”

Brazil is now entering the home straight to this year’s general elections, with political campaigns set to start in earnest later this year.

“The much more probable scenario is therefore one of continued weak annual growth of around two percent,” says Mr Shearing.

Boosting confidence

But there have been some positive comments emerging from the situation, and a few economists praised the results and the country’s 6.3-percent increase in investment last year.

That jump in investment should go some way to convincing wary investors that improvements to the economy are occurring and that the government is likely to be more market-friendly should President Rousseff win a second term in office.

Regaining sagging market confidence at home and overseas is also going to be key to getting Brazil back to more impressive results, but investment is still below the level that many investors would like to see and pessimism is said to reign among business leaders – who bemoan the incumbent government’s monetary policy as having been too overbearing.

Businesses also want Brazil to tackle the toxic mixture of suffocating bureaucracy, a poorly educated labour force and infrastructure that is not fit for purpose – all of which increases the price of doing business in Brazil, often referred to as the “Brazil cost”.

Professor Chague cites the example of Brazil’s ports which, despite investment, still experience major backlogs in getting goods in and out of the country.

Investments have been promised in the government’s official acceleration plans (PAC) and in some cases made – but progress is slow and many projects have hit obstacles.

Tough year to come

The overseas market has also not been enamoured by Brazil’s national debts, even though the government has promised to cut US$18.5 billion in public spending this year to show it is tackling the issue.

With extra investments promised for infrastructure, the World Cup and the Olympics to pay for, and more money pledged for cash-strapped public services in response to protesters, few people are expecting Brazil to spend less this year, and ratings agencies have hinted they might put Brazil on a negative outlook if signs of economic improvement fail to appear.

Most market analysts put GDP growth forecasts for 2014 at 1.7 percent and the government’s official prediction has recently been slashed from 3.8 to 2.5 percent.

Despite this Mr Mantega says he believes the Brazilian economy to be “on a trajectory of gradual acceleration [that] will continue in 2014” and described 2013 as a “difficult year”.

But the government is in a Catch 22 situation: they must spend more to appease social unrest and prove they are investing more and improving infrastructure, but also simultaneously cut spending to allay market concerns and bolster confidence.

Several additional issues – including a severe drought in parts of the country affecting harvests, economic chaos in neighbouring Argentina and Venezuela, as well as ongoing protests and the make-or-break of this year’s World Cup – could also collude to stymie economic activity further and make 2014 yet another difficult year.

Extended version of article for Anadolu Agency