Jair Bolsonaro - a staunchly conservative Brazilian military veteran and political neophyte - won the presidency of his native country in a runoff election Oct. 28. Opinions on Bolsonaro vary considerably but generally fall, thus far, into broadly positive and negative categories: Supporters champion the president-elect's brash, firm style of nationalism and anti-corruption promises, while critics decry his penchant for inflammatory statements against social, racial and sexual minorities, as well as his lack of political experience. However, markets both inside and outside Brazil, whatever their other political opinions may be, believe Bolsonaro's presidency could positively galvanize the Brazilian economy, according to BBC News.
This faith among financiers stems in no small part from the experience of Bolsonaro's right-hand man on financial matters, Paulo Guedes. Bloomberg noted that Guedes attended the University of Chicago and studied under legendary economist and Nobel Prize winner Milton Friedman, giving him a strong background in theoretical macroeconomic thinking, but is also known to international market leaders as having decades of experience and a record of consistent success.
On numerous occasions, Guedes has cited Brazil's civil pension system and tax code as two of the major economic issues he and the new president plan to tackle, both of which played major roles in creating federal deficit and general recession. Guedes also believes the privatization of various government-sponsored enterprises will make for a much more open and successful market.
Brazil's pre-Bolsonaro political establishment accrued massive displeasure among the general public as well as the business communities, for numerous reasons: Between 2003 and 2018, Presidents Luiz Inacio Lula da Silva, Dilma Rousseff and Michel Temer all oversaw and were involved in - and, in da Silva'a case, imprisoned for - a laundry list of offenses, nearly all of them involving financial impropriety. These issues, as well as a decade-long recession, eroded public confidence in the Worker's Party all three belonged to. Rousseff was removed from office by Brazil's Congress, and Temer's conviction barred him from running for public office, creating the void Bolsonaro's upstart campaign eventually filled.