Elections: There will be no institutional pacification in the next government, says Arko

The institutional political environment is the main risk factor for Brazil and this risk is growing. This is the main conclusion of a comprehensive study carried out by Arko Advice, which analyzed the country's cyclical volatility. The global risk score assigned to Brazil is 57 points, on a scale of 0 to 100, with an upward bias. To WW, political scientist and CEO of Arko Advice, Murillo de Aragão, comments on the study.

The study is structured around three pillars: the institutional political environment, the geopolitical situation and the economic environment.

The institutional political environment received the highest score among the three, reaching 68 points, also with an upward bias. The geopolitical situation was classified with 48 points, at medium risk, while the economic environment registered 45 points, equally with an upward bias.

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Economic risk has not yet reached the population
According to Murillo de Aragão, the economic issue is serious, especially due to the fiscal and interest aspects, which harm productive activity. However, he assesses that this impact is not yet widely felt by the population, as inflation remains reasonably under control.

"The economic issue is serious due to the fiscal and interest aspects, which hinder productive activity. But it has not yet reached the population, because inflation is reasonably under control", he stated.

Aragão highlighted that fiscal insecurity leads business people to withdraw their investor instinct. "With this insecurity regarding the tax issue, the businessman retracts his instinct as an investor. He prefers to wait and see what will happen", he explained.

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For him, the economy is being affected gradually and silently, like a slow warming process that is not yet clearly perceived by society.

Institutional crisis does not depend on the electoral result
In the institutional political field, Aragão was categorical in stating that there will be no pacification in the next government, regardless of who is elected.

"I don't see institutional pacification in the next government, because the profile of the candidates does not indicate someone who has the vocation and willingness to face an institutional dialogue that is stabilizing", he declared.

The analyst pointed out that the institutional crisis situation will begin to be defined in the first round, with the composition of the Chamber of Deputies and the Federal Senate. According to him, there is a clear intention from political sectors, which could become a majority in the Senate, to move forward with impeachment of ministers and approve constitutional amendments limiting or creating mandates for ministers of the STF (Supreme Federal Court).

"I think there will continue to be a power struggle, an institutional conflict, a mix of skills, an absence of limits, but, above all, an absence of vocation for dialogue", concluded Aragão.

The only perspective for dialogue he pointed out would be conditional on a severe deterioration of the fiscal framework. "The hope for a dialogue is if the fiscal situation becomes so bad that it could force political agents to sit at the table and look for a way out," he said.

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Source: CNN