Brazil's Mantega says opposition win could wreck economy

jueves 28 de agosto de 2014 16:12 GYT

By Alonso Soto

BRASILIA Aug 28 (Reuters) - Brazil's finance minister waded into the country's presidential campaign on Thursday, warning that an opposition victory in the October election could push the economy into recession and undo a decade of social gains under the ruling Workers' Party.

The comments by Guido Mantega, which the opposition and some analysts criticized as unbecoming of a sitting finance minister, came on the eve of the release of official data that is expected to show that Brazil, Latin America's largest economy, is already in recession.

Brazil's once high-flying economy has slowed sharply in the last four years under President Dilma Rousseff, complicating her chances for re-election in October. Growth is now at a crawl, inflation is running high, and business confidence has evaporated, discouraging investment.

The slowdown has given the opposition ample fodder to criticize Rousseff on the campaign trail.

Mantega sought to paint a rosier portrait and said he worries that a new government would raise interest rates to "stratospheric" levels to curb inflation, derailing the economy and throwing Brazilians out of work.

"If they criticize us, that's because they plan to do the opposite. That will create a recession, increase unemployment and revert social and real income gains made by the population," Mantega told reporters after unveiling the 2015 budget bill.

Some analysts frowned on Mantega's comments, saying a finance minister should steer clear of election politics.

"I find it strange that a minister makes a comment like that," said Jankiel Santos, chief economist at Espirito Santo Investment Bank in Sao Paulo.   Continuación...