Brazil’s political and economic landscape this week reflects a mix of growth, fiscal challenges, and internal disputes within the government and opposition. The country’s GDP grew by 3.4% in 2024, but fiscal pressures and political maneuvering over the budget have raised concerns about economic sustainability. Finance Minister Fernando Haddad faces resistance both from within the government and from opposition forces, particularly those linked to the Bolsonaro family. Meanwhile, Eduardo Bolsonaro’s presence in the U.S. complicates right-wing strategies for 2026, while social media battles further weaken Haddad’s position. These dynamics underscore the ongoing struggles of President Lula’s administration to maintain stability amid conflicting political interests.
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Brazil’s GDP Growth in 2024
Brazil’s economy expanded by 3.4% in 2024, the highest growth rate since 2021, driven by increased household consumption and investment. The services sector played a crucial role, while industrial production also showed signs of recovery. However, despite the strong annual performance, the GDP increase in the fourth quarter was just 0.2%, suggesting a potential slowdown. High interest rates aimed at controlling inflation, which ended 2024 at 4.8%, have begun to weigh on economic activity. While the government celebrates these figures as a sign of economic resilience, analysts warn that sustaining growth in 2025 will be challenging. The combination of tighter monetary policies, external uncertainties, and fiscal constraints may limit expansion.
2025 Budget
The 2025 federal budget was approved on Thursday (20/03) and presents a projected surplus of R$15 billion, higher than the R$3.7 billion forecast by the government in the original text. This surplus, according to the rapporteur, Senator Ângelo Coronel (PSD), came from the inflation adjustment applied to the spending cap. The result is only positive because R$44 billion earmarked for the payment of court orders is not included in the calculation of the spending cap. The IFI (Independent Fiscal Institution), a Senate body that monitors public finances, expects the government to have a primary deficit of R$71 billion this year, equivalent to 0.6% of GDP – including the payment of court orders.
Budget Control
The federal budget has become a major political battleground in Brazil, with Congress asserting greater control over spending decisions. Lawmakers are leveraging budget negotiations to secure funding for their priorities, limiting the executive branch’s ability to direct economic policy. This power shift complicates President Lula’s efforts to manage fiscal policy effectively. The increasing role of parliamentary amendments in shaping the budget reduces the government’s flexibility, forcing it into negotiations with political allies and opponents alike. The final budget report considers R$50.3 billion for parliamentary amendments.
Haddad’s Political Struggles
Finance Minister Fernando Haddad is facing increasing resistance within the government, complicating his ability to implement key economic policies. While he advocates for fiscal discipline and long-term stability, various factions within the administration oppose his stricter financial measures. This internal opposition weakens his authority, making it difficult to secure necessary political support for his economic reforms. As a result, Haddad finds himself in a precarious position, attempting to balance fiscal responsibility with political negotiations. His challenges are further amplified by external pressures from Congress, where lawmakers seek greater control over budget allocations.
Social Media Attacks on Haddad
Right-wing politicians have intensified their attacks on Finance Minister Fernando Haddad through social media, undermining his ability to push forward economic policies. Figures such as Eduardo Bolsonaro, Carla Zambelli, and Débora Albuquerque are using digital platforms to shape public opinion and fuel opposition to the government’s fiscal agenda. These online campaigns portray Haddad as ineffective, eroding public trust in his leadership and complicating negotiations within Congress. By dominating social media discourse, these politicians can mobilize supporters and pressure lawmakers to resist Haddad’s proposals.
Eduardo Bolsonaro
Eduardo Bolsonaro, son and close political ally of former President Jair Bolsonaro, is increasingly engaging in political activities in the United States, creating tensions within Brazil’s right-wing Liberal Party (PL). His efforts to strengthen international alliances and interaction with far-right figures abroad have sparked divisions within his party, as some members believe he should focus more on domestic politics. Eduardo’s absence from key political debates in Brazil has weakened his influence within the PL, opening space for other conservative leaders to gain prominence. At the same time, his growing international presence has drawn criticism from both allies and opponents, who argue that his actions are disconnected from Brazil’s immediate political challenges. This situation has made it difficult for the PL to consolidate a clear electoral strategy, as different factions within the right-wing movement compete for leadership.
Analysis:
Brazil’s current political and economic landscape reflects a government struggling to balance fiscal discipline with intense political negotiations, while the opposition leverages institutional mechanisms and social media to weaken its stability. The 3.4% GDP growth in 2024 is a positive indicator, but the fourth-quarter slowdown and persistent fiscal challenges highlight an uncertain trajectory for 2025. Despite the projected R$15 billion budget surplus, the exclusion of R$44 billion in court-ordered payments raises concerns about fiscal transparency and long-term sustainability.
A major factor shaping Brazil’s governance is the growing influence of parliamentary amendments, which allow lawmakers to allocate federal funds with minimal executive oversight. The R$50.3 billion assigned to these amendments in 2025 increases Congress’s power over budget execution, reducing President Lula’s control over fiscal policy. This fragmentation forces Finance Minister Fernando Haddad into complex negotiations, as he contends with internal resistance and pressure from legislators who prioritize political deals over economic stability.
Meanwhile, the opposition continues to weaponize digital platforms to erode government credibility. Figures like federal deputy Eduardo Bolsonaro, who decided to leave Brazil for the United States, are fueling divisions within the right-wing Liberal Party (PL), complicating its 2026 electoral strategy. His absence from domestic political debates weakens his influence in Brazil but strengthens his far-right international alliances, creating tension among conservative factions.
