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Brazil's Lula faces challenging second term after electoral victory
By Patrick Moser
AFP
SAO PAULO
Petroleumworld.com 10 31 06
Reelected by a landslide, Brazilian President Luiz Inacio Lula da Silva will face some tough challenges if he is to deliver on his pledge to tackle endemic poverty while spurring economic growth.
The self-styled champion of the poor garnered 60.83 percent of the vote in Sunday's run-off presidential election that pitted him against Geraldo Alckmin, who was favored by the business and investment communities.
Despite his strong popular mandate, Lula will have to seek political alliances as his leftist Workers Party (PT) has only 83 deputies in the 513-seat lower House and 11 of the 81 Senate seats.
He will also face pressure to deal with the corruption that has tarnished his first term and forced some of his close government and party aides to resign.
But analysts say his toughest challenge will be to speed up economic growth while at the same time delivering on his pledge to improve the lot of the millions of Brazilians who survive on less than two dollars a day.
"Brazil faces a serious public deficit problem and will have to cut state spending after an electoral year of heavy spending," said Maria Celina d'Araujo of the Getulio Vargas think-tank.
"The challenge is to give priority to economic growth while keeping the deficit under control," she said.
Lula, 61, has vowed he would not slash spending on social programs such as the "Family Allowance" that hands out cash support to 11 million needy families.
"The poor will take precedence," the charismatic, bearded president told thousands of jubilant supporters at a victory celebration Sunday night in Sao Paulo.
"The enemy is now the social injustice we must defeat," said Lula, a onetime shoeshine boy and a former metal worker with little formal education.
He insisted that while remaining committed to a more just distribution of wealth, he would maintain tough fiscal policies. He expressed confidence economic growth would reach five percent, as compared to a disappointing 2.3 percent last year.
Washington on Monday congratulated Brazil for the "free and fair" vote it said demonstrated the strength of democracy and freedom in the Americas.
"The US looks forward to working with President Lula and the Brazilian people to ensure peace, stability and economic growth throughout the hemisphere," US State Department spokesman Eric Watnik told AFP.
Since he took office in 2002, Lula has toned down his once-fiery rhetoric and maintained orthodox economic policies. Inflation is now under control, foreign trade is at a record high, and a large chunk of Brazil's foreign debt has been paid off ahead of time.
During his campaign, Alckmin had not called for any major policy changes, focusing instead on the scandals that dogged Lula's fist term.
Claims of campaign wrongdoing cost Lula the chance of winning re-election in the October 1 first round election, when he fell 1.4 points short of the simple majority needed to avert a runoff against Alckmin.
Lula has denied any prior knowledge of the affairs.
Voters on Sunday also elected governors in 10 of Brazil's 27 states, where gubernatorial elections were not decided in the October 1 voting.
AFP 30 2246 GMT 10 06
Copyright ©2006 AFP All Rights Reserved.
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