Brazil Pension Reform Clears Congress, Stocks Hit New Highs
Brazil’s Senate on Tuesday approved a sweeping overhaul of the country’s pension system to stabilize public finances and restore business confidence, setting up President Jair Bolsonaro to sign his keystone economic proposal into law.
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The Senate approved the main text of the landmark pension reform by a margin of 60-19 in a late Tuesday session before moving on to consider amendments.
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Brazilian markets rallied and stocks hit an all-time high as the government cleared the final legislative hurdle for its top economic priority. Economists have said the controversial cuts to social security spending are crucial to closing a fiscal deficit that cost Brazil its investment-grade credit rating.
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Pension reform has dogged successive governments over the past three decades and has been at the center of congressional debate for three years running, while the social security deficit has steadily risen.
The bill passed by the Senate aims to save the Treasury around 800 billion reais ($195 billion) over the next decade via measures that include raising the minimum retirement age and increasing workers’ pension contributions.
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