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Kaieteur News
Tuesday March 29, 2016
Brazil debates economic cost Police: New leads in of corruption investigation Mahabir abduction
Rio de Janeiro (AFP) Brazil’s former president Luiz Inacio Lula da Silva is raising hackles after warning that the mega Petrobras corruption probe is paralyzing essential sectors of the Brazilian economy, like oil and construction. Many saw Lula’s comments as a cynical attempt to deflect public attention from a two-year-old investigation, now that he has been implicated in the widening corruption scandal. But the issue he touched on, invoking the IMF as an authority, is at the centre of a growing debate among analysts and economists. At a meeting with union organizers in Sao Paulo on Wednesday, the former machinist said the probe was necessary but asked “whether it’s not possible to combat corruption without closing companies... and without causing unemployment.” According to the IMF, he said, a 2.5 percentage point contraction in Brazil’s economy was attributable “to the panic created in Brazilian society.” “When this is all over, there could be a lot of people in jail, but there could also be millions of unemployed,” he said. The IMF in January projected that the Brazilian economy would shrink by 3.5 percent this year, 2.5 percentage points more than its previous estimate. In 2015, the Brazilian economy sank 3.8 percent. According to GO Associados consultancy, the corruption probe has reduced Brazil’s GDP by about 3.6 percentage points, taking into account direct and indirect effects as well as the incomes
Balloons depicting Brazilian President Dilma Rousseff and former president Luiz Inacio Lula da Silva as prisoners are sold during a protest in Sao Paulo, Brazil (AFP Photo/Nelson Almeida) of hundreds of thousands of employees. Unemployment, meanwhile, has continued to climb, rising to 8.2 percent in February compared to 5.8 percent a year earlier. Maurice Obstfeld, the IMF’s chief economist, attributed the worsening outlook to the “political configuration” of Brazil, with the “initiation of impeachment proceedings (against current President Dilma Rousseff) and the increasing scope of corruption allegations.” These factors, he said, “have undermined confidence, as has the continued deterioration of the fiscal outlook.” PROBE DID ‘NO DAMAGE’ Reaction to Lula’s statements has been swift. Antonio Cesar Bochenek, the president of the Association of Federal Judges of Brazil, said the corruption probe “has done no damage... and has allowed for the recovery of three
billion reais ($800 million), as well as goods and property.” “Impunity increases corruption and corruption causes disastrous damage to the economy,” Bochenek told newspaper O Estado de Sao Paulo. For Jose Robalinho Cavalcanti, president of the National Association of Attorneys of the Republic, “Lula does himself a disfavor with such declarations because... he was in charge of running the country and knows very well that the economic situation is formed much more by economic policy than any investigation.” Brazil has been rocked by allegations that construction companies colluded to overbill state oil giant Petrobras by billions of dollars, bribing corrupt executives and politicians to look the other way. About a hundred people, from Petrobras executives to owners of Brazil’s largest construction companies, have already been convicted.
(Trinidad Guardian) Investigating officers say they have several leads in the abduction of school teacher Keston Mahabir and are hopeful of a breakthrough soon. Since Mahabir’s abduction, police have detained several people for questioning, including the mother of a 17-year-old girl and a female Venezuelan national. However, no one has been charged. Up to yesterday, they had not been able to determine a motive for the abduction and suspect it may just be “an eerie case of mistaken identity.” A close friend of Mahabir, who described the missing school teacher as fun, loving and caring, said close friends are holding prayers and hoping for his safe return. “We want to hear something positive in this. We are hoping that somebody would get a call and tell us where to find Kessy (as he is fondly called). This seems like a never ending nightmare and we really hope that the police gets whoever is behind Kessy’s abduction,” the friend said. Mahabir, head of Keston’s Educational Insti-
Abducted: Keston Mahabir tute of Pitiman Trace, Mc Bean Village, Couva was abducted from his home last Wednesday. CCTV footage shown exclusively on CNC3’s Crime Watch programme last Thursday, shows that at about 11.50 am, two women parked a silver vehicle near Mahabir’s house. Mahabir, who was wearing a red t-shirt, met the women and escorted them inside the house, where he conducts his classes. Two minutes later, two men are seen coming around the front of the house and entering the door. A few minutes later, one of the men is seen coming
back outside, this time, holding Mahabir around the neck and walking him back out to the front of the house. A few seconds later, the second man came out of the house and walked to the front behind the first man and Mahabir. The men were wearing bandanas covering their faces. Mahabir, a graduate of the University of T&T, has spent the last five years teaching Mathematics, English and Human and Social Biology at his private school. He is expected to take up a teaching position at the University of the West Indies in St Augustine from September.
OAS Permanent Council to discuss finance and banking services challenges WASHINGTON, USA — Caribbea n a n d C e n t r a l American states have recently been subject to worrying developments directly affecting their financial services sector that pose a threat to their economic growth and political stability, says Sir Ronald Sanders, chair of the Permanent Council of the Organization of American States (OAS) and ambassador of Antigua and Barbuda. This issue will therefore engage the attention of the Permanent Council at a special meeting tomorrow at OAS headquarters in Washington, DC. The Council will hear from three expert speakers – Bruce Zagaris of the firm B e r l i n e r, C o r c o r a n & Rowe; Ryan Pinder, member of Parliament and former financial services minister of The Bahamas; and Daniel J. Mitchell, a senior fellow at the Cato Institute – before participating in a dialogue on
the issue in keeping with the OAS’s responsibility to seek solutions to urgent problems that affect member states. According to the draft declaration to be approved by the special meeting, member states should join together in seeking a solution to urgent or critical problems that may aris e whenever the economic development or stability of any member state is seriously affected by conditions that cannot be remedied through the efforts of that state. Given the adverse impact of unsustainable debt burden on the development of member states, the de-risking strategies applied by global banks that threaten correspondent banking relations and the regulatory and economic challenges stemming from disparate tax information exchange standards throughout the hemisphere represent a
serious threat to the financial stability of member states. The severing of correspondent banking relationships with commercial banks in some member states by global banks in other member states poses a severe threat to economic growth, social development and political stability, especially of small economies, by curtailing their ability to participate in standard international financial and economic transactions. There is accordingly an urgent need for action to ensure that banking regulations designed to foster transparency and accountability and prevent money laundering and terrorism financing do not result in financial exclusion and economic decline of small economies by cutting their access to international correspondent banks.