Jair Bolsonaro: Brazil’s Government Is Preparing a $32 Billion Stimulus Package, According to Reports | Stimulus Update

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BRASILIA-Three sources familiar with the proposal told Reuters that Brazil’s federal government planned to launch a program delivering 165 billion reais ($32 billion) in economic stimulus during the current election year on Thursday.

According to the sources, the so-called ‘Income and Opportunity Scheme’ includes an early payment of some public pension checks, a measure allowing workers to take money from a severance fund known as FGTS, a new microcredit program, and an extension of payroll-deductible loans.

They claim that at least 30 billion reais will be released from FGTS, allowing workers to earn up to 1,000 reais each year, a move that Economy Minister Paulo Guedes had already hinted at.

President Jair Bolsonaro’s and his predecessor Michel Temer’s governments have already taken steps to free up such monies. Money can only be withdrawn from FGTS in certain conditions, such as when a worker retires, is dismissed, or wishes to purchase real estate.

Stimulus Check & Jair Bolsonaro Brazil's Government Is Preparing a $32 Billion Stimulus Package, According to Reports Stimulus Update (1)
Jair Bolsonaro: Brazil’s Government Is Preparing a $32 Billion Stimulus Package, According to Reports | Stimulus Update

The government will also push ahead with the payment of some public pension checks, according to the sources, replicating a move made during the coronavirus pandemic in 2020 and 2021. Before the October elections, the anticipated July payment would reach retirees’ hands.

Bolsonaro, who is set to run for re-election, is currently lagging former leftist President Luiz Inacio Lula da Silva in opinion polls.

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According to the sources, the formation of a microcredit program and the extension of payroll-deductible loans aims to provide workers with resources that can be invested in small enterprises.

(1 dollar = 5.0949 reais)

(By Lisandra Paraguassu and Bernardo Caram; Marcela Ayres contributed additional reporting; Brad Haynes, Nick Zieminski, and Rosalba O’Brien edited)

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