Most of Lula spending package sits outside Brazil fiscal cap, with only a sliver counted under the rules he wrote. Why it still lifts the public debt.
Key Facts
—The package. Lula’s election-year measures total around R$215–227bn ($42–45bn), close to 1.6% of GDP, on the main tallies.
—Inside the cap. Economist Marcos Mendes of Insper finds only about R$9bn fits within the arcabouço fiscal, roughly 4% of the total.
—The mechanism. Much runs through subsidised credit via the development bank, booked as financial rather than primary spending.
—The debt. Net public debt hit about 67.4% of GDP in April, a record in the series that began in 2001.
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