By Bernardo Caram
BRASILIA (Reuters) – Brazilian President Luiz Inacio Lula da Silva was right to tone down his criticism of the central bank and if he taps Gabriel Galipolo to head the monetary authority later this year that would be an excellent choice, his former finance czar told Reuters.
Guido Mantega, who was finance minister during part of Lula’s 2003-2010 government, said in an interview on Monday that the leftist leader has “periodically” sought his advice on economic matters.
In June, Mantega was among economists who met with the president and advised him to stop attacking central bank chief Roberto Campos Neto for what Lula saw as Brazil’s excessively high interest rates, currently at 10.50%.
Lula and Campos Neto, who was appointed by far-right former President Jair Bolsonaro, had a public spat in June after the central bank paused a monetary easing cycle despite government pressure to continue reducing rates.
Lula did lower his tone on the advice of the economists.
“There was too much noise due to Lula’s criticism, so I thought this kind of thing had to stop,” said Mantega, a long-time advocate of more development spending, which did not endear him to financial markets.
Mantega was Brazil’s longest-serving finance minister, from 2006 to 2015, working under both Lula and his successor, Dilma Rousseff, who presided over a major economic crisis and was impeached in 2016.
Mantega, who believes the Lula administration is on a path to balance public accounts, said he supports Lula’s potential nomination of Gabriel Galipolo as central bank governor when Campos Neto’s term expires in December.
Galipolo, a former executive secretary at the finance ministry, has been the central bank’s monetary policy director since 2023, when Lula appointed him a director. He is widely seen as the front-runner to replace Campos Neto.
Mantega argued that the next central bank head should be experienced and have a deep understanding of macroeconomics, in addition to being close to Lula and having his trust.
“Galipolo has that profile,” said Mantega. “He would be an excellent choice.”
NO BRASKEM, NO VALE
Lula has kept Mantega as an “informal adviser” but had the intention of appointing him for a position at a company.
In recent months, Mantega was sounded out by the government about becoming a board member at petrochemical producer Braskem, which is controlled by conglomerate Novonor and state-run oil giant Petrobras.
But the talks have not progressed, he said.
“I don’t know what’s going on, I haven’t received any additional information about it,” Mantega said.
In January, media reports – including by Reuters – indicated that Lula engaged in discussions about mining giant Vale and wanted Mantega to be appointed to the company’s board or even as its CEO.
Vale was privatized in the 1990s and has a dispersed ownership, but the government still exerts significant influence as its main shareholders include a pension fund operated by state-run lender Banco do Brasil.
Mantega said he would not accept a role at the firm.
“There is no chance,” he said when asked about Vale. “I have no wish to work there.”
(Reporting by Bernardo Caram; Writing by Gabriel Araujo; Editing by Leslie Adler)
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