Recent Political Developments Impact Brazilian Mining Industry

Early in December, after much political wrangling, Brazil's government finally opened impeachment proceedings against President Dilma Rousseff. In wake of recent revelations regarding fraudulent financing and other policymaking disasters, this move hardly comes as a surprise. While Rousseff's political opponents claim her actions have made such a step inevitable, the Economist points out that an impeachment is the last thing Brazil actually needs.

With a vast corruption scandal in full swing, an economy in free fall, public finances in tatters—and a self-serving political class in no mood to tackle any of it—the country has now been served up a constitutional crisis. (Economist)

Of course, all of the turmoil isn't doing any of the nation's industries any favors--including the mining industry. Brazil's economy is predicted to shrink by a total of 2.8% by the end of 2015, with another 1% predicted for 2016. This would be the first time the country has experienced two years of back-to-back recession since the 1930s.

[The] Brazilian economy needs structural reform, in the form of tax and political reforms, to address its fiscal imbalances. In a democratic framework, this can only be achieved through political consensus, which, as things stand currently, is lacking in Brazil right now (Investopedia)

With the sort of political shenanigans occupying Brazil's higher-ups just now, it doesn't seem likely that the necessary public policy issues will be tackled any time soon. We hope, however, that the turmoil soon passes, and that the country can soon haul itself up by its own democratic bootstraps.

Do you have thoughts, concerns, or predictions regarding how Brazil's volatile political situation could impact the mining industry both inside and outside its borders? Feel free to share in the comment section.

As always, remember that we carry a full line of OTR tires for all of your mining, farming, and other big-rig needs. Feel free to contact us for more information.

Image credit: "Dilma Rousseff - foto oficial 2011-01-09" by Roberto Stuckert Filho/Presidência da República - Agência Brasil. Licensed under CC BY 3.0 br via Commons

The post Recent Political Developments Impact Brazilian Mining Industry appeared first on BuyBigTires.com.