Zema Links Minimum Wage Rise to Economy
- Romeu Zema has pledged full inflation compensation for Brazil's minimum wage, but says above-inflation rises will only follow if the economy is performing well.
- The Novo party candidate called for a reduction in the Selic benchmark interest rate, criticising its impact on public debt and household incomes.
- Zema cited more than 300,000 Minas Gerais pensioners who went without pension payments as an example of the consequences of poor fiscal management.
Romeu Zema, the Novo party presidential candidate and former governor of Minas Gerais, has pledged to adjust Brazil's minimum wage in line with inflation but has made any above-inflation increase explicitly conditional on the health of the broader economy.
A conditional wage promise
Speaking during an interview on Jornal Nacional on Monday, Zema set out his position in unambiguous terms. "I guarantee that nobody will suffer losses. If there is inflation, we will give the full amount of inflation," he said. Above-inflation rises, he added, would be granted only "if the economy is doing well and accounts are balanced."
Zema also described as "absurd" any situation in which retirees fail to receive full inflation compensation, pointing to the case of more than 300,000 pensioners in Minas Gerais who, he said, went without receiving their pensions. He appeared to invoke the example as a warning against repeating such an outcome at the national level.
Interest rates and the public finances
The candidate also called for a reduction in Brazil's benchmark Selic interest rate, arguing that lower borrowing costs are necessary for economic recovery. He criticised the current rate's effect on the country's public debt and on the day-to-day incomes of Brazilian workers and households.
The pledge leaves the question of real wage growth firmly unresolved: Zema did not specify what economic conditions or fiscal benchmarks would need to be met before workers could expect rises beyond the rate of inflation. Zema, who has also pledged amnesty for those convicted in connection with the January 8th riots, is among the candidates vying for the Brazilian presidency.
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