After pro-Bolsonaro demos, the stalemate continues

Author

Gustavo Ribeiro
May 28, 2019 • Reading Time: 6 minutes

After pro-Bolsonaro demos, the stalemate continues

Sunday’s pro-Bolsonaro protests have kept the country at a stalemate. Demos were large enough to dissipate precocious talks of impeachment, but not big enough to scare lawmakers into following the agenda set by the Executive branch. Yesterday’s events were much smaller than the May 15 non-partisan protests against cuts to the education budget—but still showed that the president has control over his core base of supporters.

While opponents called the events a flop, Mr. Bolsonaro’s supporters claimed victory, calling the events an “enormous, spontaneous popular demonstration.” And that war of narratives could spark more tension between the government and Congress. Throughout Sunday, the president tweeted a series of videos of the demonstrations—many displaying attacks towards Congress and the Supreme Court. That evening, Mr. Bolsonaro gave an interview saying “people are fed up with the old ways of politics.”

House Speaker Rodrigo Maia was one of the main targets of protesters. In Rio de Janeiro, demonstrators took an inflatable effigy of him, calling him a “crook.” The press and the Supreme Court were also on the receiving end of insults. While more moderate wings of the government tried to say that the acts were in favor of the pension reform, it is possible to say that the right-wing is divided.

Conservative forces such as MBL (Free Brazil Movement), the Federation of Industries of São Paulo, evangelical leaders, and lawmakers with massive popular support such as Joice Hasselmann and Janaina Paschoal, were against the demonstrations—and were called “traitors.”

The viability of this administration will depend on whether President Bolsonaro will use these demonstrations to strike a peace deal with Congress, or if he will entrench himself within the most radical wing of his support base.

Government set for major arms purchase

The Justice Ministry is preparing a bidding process to purchase 106,000 pistols to be distributed to the National Security Force and police forces across Brazil. The process, the very first by the ministry, will be worth around BRL 444m. Foreign companies will be allowed to take part, thanks to a recent presidential decree loosening up gun control laws and opening up the market for imports. The bill will be split between the federal government and the state administrations which will receive the weapons.

With this bidding process, the federal government wishes to reduce the lack of firepower detected in most police departments—which are controlled by state governments. A preliminary document produced by the Justice Ministry says that “pistols are the second-most-needed item for state law enforcement agencies.”

Instead of the .40 pistols traditionally used by police forces, the ministry will purchase 9mm handguns. Experts have questioned the call, saying that the lack of a single standard could make maintenance more challenging. “Not to mention the possibility of an officer running out of ammo during an operation, but his colleague not being able to help him, as they carry different caliber guns,” said Bruno Langeani, manager at think tank Sou da Paz Institute.

The bidding war for Netshoes continues

The race to purchase online sportswear retailer Netshoes continues. The company announced on Sunday that Magazine Luiza—one of Brazil’s largest retail chains—raised its offer to take over operations from USD 2 per share to USD 3—raising the company value to USD 93.2m (from 62m). Netshoes’ board approved the offer and recommended shareholders accept it.

A month ago, Magazine Luiza had reached an agreement (which was pending shareholders’ approval) to buy Netshoes for USD 2 per share. But on May 23, sportswear retailer Centauro made an offer of USD 2.80 per share, jeopardizing the deal. Now, Magazine Luiza seems to have the upper hand. Especially since Netshoes’ board fear problems with regulators in a deal with Centauro—the merger would create a player with over 50% of the sportswear retail market in Brazil.

Despite this recent rise in worth, Netshoes remains way below its value at the company’s initial public offering in the New York Stock Exchange—USD 18. Accumulating successive losses, the company has recently gotten rid of its operations in Mexico and Argentina. After Q4 2018, the company posted BRL 90m in losses.

Also noteworthy

Riot. Fifteen inmates were killed in a riot at Manaus’ Compaj prison. The confrontation between different factions started around 11 am on Sunday, during visiting hours, and was subdued by the police within 40 minutes. Compaj is the same prison where 56 people were murdered in 2017, in what was one of the deadliest riots in the history of Brazil’s penitentiary system.

Vale. The structure of an iron ore mine belonging to Vale in the state of Minas Gerais continues to shift—and part of it could collapse at any moment. Authorities say that there is a 15% chance that the imminent collapse compromises the residue reservoir—generating a spill like the ones in Brumadinho (January 25, 2019), or Mariana (November 5, 2017).

Guns. The Federal Prosecution Office has called President Bolsonaro’s decree loosening up gun ownership rules “unconstitutional.” For prosecutors, the decree will make it easier for members of criminal organizations to legally purchase weapons. It authorizes citizens to buy 5,000 rounds of ammunition per year—for the sake of comparison, a São Paulo cop uses fewer than 1,000 every year (including shots fired during practice).

New virus. The Mayaro virus, an Amazonian “cousin” of the chikungunya virus, was located in Rio de Janeiro by scientists. The discovery came after doctors admitted patients with the same symptoms of chikungunya infections—severe fever, redness, diarrhea, and terrible body pain—but tested negative for the disease. As Mayaro has been studied less, doctors still don’t know if it can cause neurological problems, similar to chikungunya.

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