Piauí Governor Rafael Fonteles has fallen out of favor as a possible choice to lead Brazil’s Finance Ministry after facing criticism from allies in the Workers’ Party (PT). President Luiz Inácio Lula da Silva, who had previously considered Fonteles for the job, has reportedly raised concerns about appointing him.
Fonteles would have to resign as governor to join the federal government. Some of Lula’s aides argue that this could make him difficult to remove from the ministry. They have also questioned whether he has enough experience in Brasília. Reports that Fonteles had met with financial-market representatives added to the concerns, with some presidential aides saying he had acted as though he already held the post. Fonteles told Folha that he had not met with businesspeople and had not discussed government positions or economic policy with Lula.
Vice President Geraldo Alckmin is also being considered, though aides see a similar obstacle: replacing him could be politically difficult if disagreements arose. According to reports cited by Folha, Alckmin has spoken with people from the financial sector and business community to gather ideas. His name has gained ground as Fonteles has come under pressure. If appointed, he is expected to be able to assemble a team of prominent economists. Lula has told aides the decision requires caution. Alckmin declined to comment.
The objections to Fonteles, including the size of the state he governs, have opened the door to other candidates, including Alckmin and Senator Camilo Santana. Santana is also being considered for other posts, such as Public Security, Education or the chief of staff’s office. If he is not chosen for the latter, former Finance Minister Fernando Haddad could take the role. Haddad is not among the candidates being discussed for the Finance Ministry.
Meanwhile, Dario Durigan, Haddad’s successor at the ministry, is seeking to consolidate his position as financial markets press for measures to balance the 2027 budget. Changes to the proposal need approval this year; otherwise, lawmakers may not vote on it until next year, when Congress is expected to be more hostile following electoral gains by the opposition.
Lula authorized Durigan to deny reports that the president would meet economist André Lara Resende to discuss economic policy. PT president Edinho Silva backed the minister, saying in a statement that Durigan was the only person speaking for Lula’s government on economic policy.
After a public holiday, Durigan also criticized Lara Resende’s proposal to lower interest rates, saying it had shortcomings, and reiterated the government’s case for fiscal adjustment. Some PT supporters of the proposal criticized his remarks, while people cited by Folha noted that Durigan’s statements on fiscal policy have strengthened his standing with financial markets.
Economic officials say the immediate priority is to settle on measures in time for Congress to consider the Budget Guidelines Law and the 2027 budget this year, rather than focus on speculation about the next finance minister or other members of a future economic team.
Sources: Folha Mercado.