Brazilian Finance Minister Henrique Meirelles said on Thursday “there’s a very good chance” that the country’s proposed pension reform bill will be approved by the end of the year. Addressing a question-and-answer session at an Institute for International Finance meeting in Washington Meirelles said that it would be simpler to pass the bill this year than next year because of political challenges that could come with Brazil’s upcoming presidential election in October 2018.
“I think there’s a very good chance of having that approved this year, which is more convenient than next year,” Meirelles said, in response to a question about the timing of the measure. “It’s a good moment for the reform to be approved in Brazil.”
Many have speculated that Brazil is unlikely to reform its costly pension system before 2019 because President Michel Temer, hobbled by a corruption scandal, is too weak to push the measure through Congress.
Temer is again facing charges that he accepted bribes in connection with the country’s wide-ranging corruption investigation known as Lava Jato or Car Wash.
The lower house of congress in August blocked a potential corruption trial against Temer, but chief prosecutor Rodrigo Janot filed more graft-related charges before stepping down from his post in September.
The pension reform bill would dramatically curb Brazil’s generous pension system, which allows workers to retire as early as their 50s. It made Temer and his ruling government very popular with investors, who believe the reforms are necessary to cut Brazil’s escalating spending, but it has helped drive the president’s popular approval ratings into the single digits.
Meirelles said he expects Brazil’s congress to vote on the measure at the end of this month or next and that he also expects a vote on the country’s proposed tax reform bill.
The minister will also be watching the ongoing talks between the United States, Canada and Mexico over the North American Free Trade Agreement, as an exit by the United States could provide an opportunity for Brazil, he said.
“Definitely, we are discussing that,” Meirelles said. If Mexico were in search of new trade partners, “we are ready to talk.”