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Tuesday, 18 February, 2003, 01:42 GMT
Lula makes plea for reform
President Luiz Inacio Lula da Silva
Lula has huge support after last year's elections

Brazil's newly-installed president, Luiz Inacio Lula da Silva has made an impassioned appeal to pass reforms seen as vital for the revival of South America's largest economy.

Speaking at the opening of the country's Congress, he talked about a great historic opportunity to bring change.

It is not normal for the Brazilian president to turn up in person for the opening session of Congress after the summer recess.

But Lula, as the new president is known, came to deliver the government's wish list of reforms, seen as indispensable by most analysts if South America's largest economy is to flourish.

Anomalies

In first place, are the country's pension and tax systems.

Many public employees, like judges, professors and military officers, get much bigger pensions than their final salaries, which can be passed on to their families if they die.

Ordinary workers, who provide the bulk of the contributions, on the other hand, get little more than the minimum wage.

The result is a massive and growing deficit which is threatening to bankrupt the state.

There are similar anomalies in the tax system.

The new Brazilian president urged Congress to take advantage of, what he called, the enormous political capital of the moment, with rare consensus between rich and poor for the need for reform.

The new president enjoys an unprecedented range of support in Brazil, after a landslide victory in elections at the end of last year.

Ironically, the reforms are largely inherited from the last government which was unable to pass them because of opposition from Lula's Workers' Party.

Lula stands a much better chance because the parties now in opposition have traditionally supported the reforms.


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02 Jan 03 | Business
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