Political Environment

Brazil is struggling with an image of corruption that is aggravated by frequent scandals involving high-level politicians and bureaucrats. Lula da Silva was elected in 2002 based largely on a campaign platform emphasizing social programmes and change in a political culture that many viewed as corrupt and favoring vested interests. However, political scandals concerning money laundering and manipulation of large government contracts have continued to surface, discouragement public trust in the political system. President Lula da Silva himself has struggled to keep clear of several corruption scandals, while there have been investigations and convictions of some of his closest political allies.

High levels of political corruption are cited as a driving force behind growing public distrust towards the political system, which is aggravated by poor public services and the fact that economic inequality in Brazil remains pervasive despite high taxes and relatively strong economic growth. It is reported that graft limits the government's ability to address pressing issues, such as crime, lawlessness, poverty and urban sprawl, and that corruption may therefore play a central role in triggering social unrest among the poor majority of Brazilians. Some observers point to the fact that corruption scandals have stalled the President's efforts to push through important legislation and key reforms. Despite Lula da Silva's anti-corruption campaign, the current Congress is described by some observers as one of the most corrupt in the history of Brazil.