In the electoral campaign, former president Luiz Inácio Lula da Silva (PT) promises to rebuild Brazilian industry with a bet on the future, supporting innovative projects that allow Brazil to compete in the development of clean energy sources and in the digital economy.
On Tuesday (9), in his meeting with businessmen at the Federation of Industries of the State of São Paulo (Fiesp), the PT leader urged industrialists to identify the niches in which the country should invest and pledged to help them. “We do,” he said. “I want to do.”
It is not known where the money will come from, nor how the choices will be made, but Lula made it clear that, if he returns to govern the country, he wants to repeat the recipe adopted in his two terms as president, when he used official and state banks to stimulate national industry.
The PT leader pointed to several initiatives of his government as exemplary, regretted their abandonment by the presidents who succeeded him and even blamed the timidity of entrepreneurs for some failures, but at no time did he examine the mistakes that led several to fail.
Lula promised to rebuild the National Bank for Economic and Social Development (BNDES), which the PT governments boosted with billionaire loans from the Treasury and his successors emptied, causing the institution to return the resources ahead of schedule.
Lula said that the bank was essential to cushion the impact of the 2008 international crisis and sustain investments, but statistics show that they lost steam again in two years, after the worst of the external crisis had passed and the economy once again showed signs of weakness.
The PT also stated that it was necessary to “do justice” to former Finance Minister Guido Mantega, who relieved several sectors of the industry during the Dilma Rousseff (PT) government, with the intention of preserving jobs and helping companies maintain their competitiveness.
But Rousseff herself pointed to the policy as a mistake after being removed from the presidency, saying in an interview that many companies took advantage of tax relief to increase profit margins rather than invest. Lula also criticized the exemptions in the past.
The former president praised his program to encourage the naval industry and the national content requirements adopted by the PT governments for equipment intended for the exploration of oil in the pre-salt layer, but also avoided discussing the difficulties they created.
Even Petrobras rebelled against the policy, resorting to the courts to get rid of demands that would make it impossible to explore the Libra field, the largest in the pre-salt layer. The dispute between the state-owned company and its national suppliers delayed the contracting of the platform by two years.
“That’s what the BNDES exists for, it’s to teach these companies how to do things,” Lula said at Fiesp, after describing the naval industry program as a success story. The sector collapsed after Operation Lava Jato and the reduction of investments by Petrobras.
The PT leader expressed concern about China’s progress in the manufacture of household appliances, machines, electronic components and other products, but was wrong to point to global data as if indicating the penetration of Chinese industry in the Brazilian market.
“We have the illusion that China is occupying Africa, China is occupying Latin America,” he told the businessmen. “No, she’s taking over Brazil. She’s taking over Brazil. I thought that was very serious. Something we used to do, something we know how to do.”
According to the Brazilian Electrical and Electronics Industry Association (Abinee), imports of products from China accounted for half of the sector’s imports last year, and was equivalent to half of national production — far less than Lula suggested with his figures.
Many Brazilian industries were harmed by competition with the Chinese, but many also took advantage of opportunities created by the greater integration of the world economy to find new suppliers, become more competitive and conquer markets.
Responding to a question from Dan Ioschpe, chairman of the board of directors of Iochpe-Maxion, about the decline of Brazilian industry, Lula criticized a businessman who would have received support from BNDES in his government and then contracted part of his production in China.
Lula didn’t name any names, but you didn’t have to go far to find a similar case. World leader in the production of wheels for cars, Iochpe-Maxion survived the collapse of the auto parts sector in Brazil and today has factories in 14 countries, including two in China.
Shortly afterwards, the PT member patted the president of Fiesp, Josué Gomes da Silva, remembering his father, José Alencar, founder of the family company Coteminas, and Lula’s deputy in his two terms: “The only businessman who spoke wholesale: ‘I’m not afraid of China’.”
“Things change,” Josué joked. Towards the end of Lula’s administration, the traditional manufacturer of bed, table and bath articles joined a giant in the textile sector in the United States and created Springs Global, to face Chinese competition and access new markets.
Controlled by Brazilians, the group closed all the factories it had in the US and concentrated most of its production in Brazil, where labor costs are lower. A few years ago, Josué considered opening a factory in China as well, but the project did not move forward.
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