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Pivot to interventionism

Bloomberg

Brazilian President Jair Bolsonaro is pivoting to shore up his public support.

His decision to replace the head of the state-controlled oil company after a feud over rising fuel prices shows the far-right leader is willing to sacrifice the market-friendly policies sponsored by his star economy minister for a more interventionist tilt.

Firing the University of Chicago-educated economist running the company caught even Bolsonaro's inner political circle by surprise, Simone Iglesias, Martha Beck and Rachel Gamarski report.

With his popularity sliding after cash handouts to the poor expired in December, the president is moving to rally his base. Truckers have been threatening to strike over rising diesel costs, and putting a general and former defense minister in charge of Petrobras may help Bolsonaro instruct the company more directly.

More changes could follow, with the president saying he's ready to revamp parts of his administration that "may not be working."

Investors aren't likely to be pleased. Confidence in Latin America's biggest economy is already waning amid a second wave of Covid-19, and now optimism is fading that Bolsonaro will stick by Economy Minister Paulo Guedes's championing of free markets and reducing the role of the state.

"It's over," said Jose Francisco Gonçalves, chief economist at Banco Fator. — Karl Maier 

Healthcare workers administer coronavirus vaccines at the Christ the Redeemer statue in Rio de Janeiro on Jan. 18.

Photographer: Andre Coelho/Bloomberg

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Global Headlines

Final push | Democrats are dropping any pretense of bipartisanship as they drive to quickly pass President Joe Biden's $1.9 trillion stimulus bill before earlier benefits run out. With a vote in the House as soon as Friday and the Senate next week, this will mark the first real test for Democrats' full control of government since former President Donald Trump's impeachment trial.

  • Biden's pick for Interior secretary, Deb Haaland, faces questions at her confirmation hearing tomorrow, with some Republicans warning she's unlikely to get their support, given her opposition to fracking, endorsement of the Green New Deal and participation in protests against an oil pipeline in South Dakota.

U.S.-China ties | Chinese Foreign Minister Wang Yi urged Biden to "build up goodwill" at a prominent forum in Beijing today. Putting the onus on Washington to repair the relationship, Wang called on the new administration to "adjust its policies as soon as possible," including the removal of "unreasonable tariffs." The comments come after Biden and President Xi Jinping spoke earlier this month.

  • Beijing plans to take seats away from pro-democracy politicians and hand them to pro-Beijing loyalists on the body that picks Hong Kong's leader, the Wall Street Journal reported.

Growing anger | Hundreds of thousands of protesters swarmed streets across Myanmar in what may be the largest turnout since the Feb. 1 coup, after two demonstrators were shot dead. The Foreign Ministry rebuffed international condemnation of the violence, and the military has ordered internet blackouts as it tightens its grip on power.

Protesters gather today in Yangon.

Photographer: Ye  Aung Thu/AFP via Getty Images

Limiting escalation | Iran offered a last-minute compromise to United Nations atomic inspectors that stops short of completely curtailing their monitoring powers, tapping the brakes on a standoff that has become a major foreign policy challenge for the Biden administration. IAEA chief Rafael Mariano Grossi said he won inspectors a three-month partial reprieve that gives diplomats space to potentially resolve the dispute over Tehran's nuclear program.

Opening schools | Prime Minister Boris Johnson will tell Parliament today that he's reopening schools in England starting March 8 and allowing more social contact by the end of next month, Emily Ashton reports. Johnson is facing calls to lift lockdown curbs with the U.K. economy suffering its worst recession in more than 300 years and cases and deaths falling rapidly.

  • U.S. efforts to detect dangerous Covid-19 mutations remain slim and disconnected.

What to Watch This Week

  • European Union foreign ministers will hold a virtual meeting to discuss Iran, potential sanctions against Russia and security before the bloc's leaders meet by video conference on Thursday and Friday.
  • South African Finance Minister Tito Mboweni will have to show a commitment to curb spending and rein in debt while trying to revive a contracting economy when he presents the government's spending framework for the next three years on Wednesday.
  • Niger held a runoff presidential election yesterday that's set to mark its first-ever transfer of power through the ballot box, with results due by Wednesday.

Thanks to all who responded to our pop quiz on Friday, and congratulations to Stephen Markscheid who was the first to name Iceland as the country that asked Pfizer to back a study on its vaccine's ability to create herd immunity but was turned down because it did too good a job of keeping Covid-19 in check.

And finally ... With Indian farmers staging protests against laws they say will destroy their livelihoods, Prime Minister Narendra Modi's government is employing a tool used against Mahatma Gandhi in the British colonial era to lock up dissidents. Under the rule, which carries a maximum penalty of life in prison, police have arrested a 22-year-old environmental campaigner, journalists, authors, academics and a former foreign minister.

Farmers sit inside a tractor trailer at a protest site at a road block on the Delhi-Haryana border crossing in Singhu on Dec. 3.

Photographer: Prashanth Vishwanathan/Bloomberg

 

 

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