Lula da Silva is considering appointing his vice president, Geraldo Alckmin, as Finance Minister if re-elected, according to knowledgeable sources. The move aims to strengthen fiscal credibility and attract centrist voters following Flávio Bolsonaro's advance in the first round.
The president of Brazil, Luiz Inácio Lula da Silva, is studying the possibility of naming his vice president, Geraldo Alckmin, as the next Finance Minister if he is re-elected, according to two knowledgeable sources cited by Reuters and reported by es.marketscreener.com. The plan seeks to bolster the government's fiscal credibility and attract centrist voters after the first round results on Sunday, where Senator Flávio Bolsonaro exceeded expectations.
According to this plan, Alckmin would retain the vice presidency while assuming the Finance portfolio next year, which would consolidate his authority over economic policy, the sources indicated on condition of anonymity due to the private nature of the discussions. The proposal is still in the debate phase, and the presidency of Brazil did not respond to a request for comments.
Alckmin, a veteran centrist politician, unsuccessfully competed against Lula for the presidency in 2006 and has served two terms as governor of São Paulo. He also led Lula's Ministry of Development, Industry and Trade until early this year, making him a key interlocutor with Washington after the United States imposed broad tariffs on Brazilian products.
Alckmin is widely considered a moderating figure in Lula's administration, with strong ties to the business community, although his detractors claim that his influence has been overshadowed during the current term by policies perceived as a shift to the left.
Lula had already considered appointing Alckmin as Finance Minister in 2022 but ultimately chose Fernando Haddad, a member of the Workers' Party, for the position after winning both the first and second rounds.
In his bid for a non-consecutive fourth term, Lula came second on Sunday behind Senator Bolsonaro, the eldest son of former president Jair Bolsonaro and an ally of Trump, in a first-round result that contradicted most polls, which had predicted a slight advantage for the incumbent.
The result, along with the electoral advance of Bolsonaro's conservative allies in Congress, triggered a sharp rise in the markets on Monday, as investors bet that a Bolsonaro-led administration would facilitate faster fiscal consolidation due to greater legislative support.
Since Lula took office, Brazil's gross public debt has increased by more than 10 percentage points of GDP to 82.9%, representing a crucial vulnerability for the leftist leader, despite inflation remaining below historical averages, economic growth exceeding expectations, unemployment at historic lows, and real wages improving.
In statements following the first-round results on Sunday, Lula emphasised Alckmin's relevance in his strategy for the second round:
“No one in this country has the moral authority to lecture me or Alckmin on fiscal policy or fiscal responsibility, given what he did in the state of São Paulo and what we did in Brazil.”
Giving Alckmin a more prominent role could help attract voters concerned about fiscal credibility who do not wish to support Bolsonaro but have become disenchanted with what they perceive as an increasingly populist bias from Lula's administration, the sources noted.
The second electoral round will determine whether Lula achieves a non-consecutive fourth term and whether the plan to place Alckmin at the head of Finance materialises next year.
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