Economy During Fernando Henrique Cardoso's presidency, the
Brazilian economy remained stable as a consequence of the inflation control achieved with the Real Plan. Brazil began to experience an economic expansion, especially in the automobile sector.
Volkswagen settled in
Resende,
Rio de Janeiro,
Iveco in
Minas Gerais and Internacional/
Agrale in
Rio Grande do Sul. The average annual inflation rate, measured by the Broad National Consumer Price Index (IPCA), was 9.71% in his first term and 8.77% in his second. In 1995, the Ministry of Administration and State Reform, headed by
Bresser Pereira, elaborated the Master Plan for State Reform (
Portuguese: ''''), which aimed to create conditions for the reconstruction of public administration on a modern and rational basis. After the success of the Real Plan, the priority for FHC's administration was to stabilize the currency and promote economic growth. In 1995, the federal government submitted a series of measures for approval by Congress to amend the
1988 Federal Constitution and promote a structural change in Brazil's state structure to adapt it to the new circumstances of the global economy. The initiatives included administrative and social security reform, deregulation of markets, flexibility in labor hiring rules and abolition of state monopolies in the steel, electricity and telecommunications sectors. In 1999, the
tripé macroeconômico, which formed the new basis of economic policy and was composed of a
floating exchange rate policy, fiscal targets and
inflation targets, was implemented. Fernando Henrique Cardoso privatized numerous sectors considered deficient, such as telecommunications, electricity distribution, mining and finance. The opposition, especially the
PT, contested these practices. In eight years, the minimum wage went from 70 to 200
reais in absolute terms. In real terms, its growth was 44.28%. The average GDP growth rate was 2.33% per year and the HDI (
Human Development Index) rose from 0.753 in 1995 to 0.789 in 2000.
Crises , left, and Brazilian Minister of Finance
Pedro Malan confer ahead of the Spring 2002 meeting of the Development Committee The FHC government faced several international recessions, such as the
Mexican crisis in 1995, the
Asian crisis between 1997 and 1998 and the
Russian crisis between 1998 and 1999. Brazil was affected by the
Argentine crisis, the terrorist
attacks in the US on 11 September 2001 and the falsification of the
Enron Corporation balance sheets. Internally, it faced a crisis in 1999 when the
real depreciated significantly after the Central Bank abandoned the fixed exchange rate regime and adopted a floating exchange rate regime. In 2002, the prediction of Lula's victory in the
next presidential election triggered a massive shortfall in
hot money and increased the price of the dollar to almost R$4.00. At every crisis that occurred in other emerging countries, the Brazilian economy suffered an abrupt withdrawal of speculative international capital, forcing Fernando Henrique Cardoso to ask the
IMF for help three times. His supporters defended him by saying that upon taking office, Brazil was bankrupt and with practically no currency in dollars, requiring him to compromise on several fronts in order to stabilize the country and pass it on to his successor with properly organized finances.
Increase in public debt During Fernando Henrique Cardoso's first term in office, the imbalance led to an increase in
public debt which, at present values, stands at around R$22.8 billion, according to calculations based on data from the
Central Bank. On 1 January 1995, the public sector owed R$153.163 billion at then current values. After three consecutive years of public deficit, the debt closed 97 at R$306.494 billion. Between 1995 and 1998, the public sector spent more than it collected, which created a primary deficit of R$7.22 billion. Considering the variation in the economy's basic interest rate since 1995, the interest expenses resulting from this indebtedness reached R$15.58 billion.
Fiscal Responsibility Law (LRF) Approved by Fernando Henrique Cardoso on 4 May 2000, and published in the Federal Official Gazette the following day, the
Fiscal Responsibility Law (LRF) requires that finances be presented detailed to the Court of Accounts (Federal, State or Municipal). If the accounts are rejected, an investigation into the responsibility of the Executive branch bodies and their members for any irregularities is launched, which can result in fines or bans on candidates running for election. Although the Executive is primarily responsible for public finances, the Legislative and Judicial branches are also subject to this rule.
Health Fernando Henrique Cardoso's administration was characterized by structural changes in the Brazilian health system. The Basic Operational Standard 96 ('
) and the Operational Standard for Health Care (') were published, which contributed to the decentralization of the
SUS. The creation of the
Provisional Contribution on Financial Transactions ('''') and the approval of Constitutional Amendment 29, which better defined the participation of the three spheres of government in the financing of the SUS and established minimum percentages of their revenues to be invested in public health actions and services, also stand out. The
Brazilian Health Regulatory Agency (
Agência Nacional de Vigilância Sanitária - ANVISA) and the
Brazilian Supplementary Health Agency (
Agência Nacional de Saúde Suplementar - ANS) were created to improve Brazil's management and performance in health care, and to comply with the Health Plans Law, respectively. The period was characterized by intense debates on supplementary health and the regulation of health plans. The approval of the
Basic Care Budget (
Piso de Atenção Básica - PAB), a regular and automatic transfer of federal funds, helped promote initiatives such as the Family Health Program (
Programa Saúde da Família). The Project for the Reduction of Infant Mortality (
Projeto para Redução da Mortalidade Infantil - PRMI), as part of the
Solidarity Community Program (
Programa Comunidade Solidária), the intensification of measures to combat cigarette consumption and the approval of Law No. 9.313, which determines the free distribution of
antiretroviral treatment (ARV) to HIV/AIDS sufferers, are also noteworthy.
Environmental policy Deforestation in the
Amazon increased during the first administration of Fernando Henrique Cardoso. In 1995,
PRODES/
INPE recorded the highest rate since 1988, with 29,059 square kilometers of cleared area. As a solution, the government raised the legal reserve area for rural properties in the Amazon from 50% to 80% and banned the cutting of mahogany and
virola for two years, which limited logging, one of the activities responsible for deforestation in the region. In 1998, large and extensive fires occurred in
Roraima, which led to the implementation of the Program for the Prevention and Control of Burning and Forest Fires in the Arc of Development (
Programa de Prevenção e Controle às Queimadas e Incêndios Florestais no Arco do Desenvolvimento - Proarco), aimed at reducing the practice of burning areas for pasture and plantations. Brazil participated actively in the development of the
Kyoto Protocol, an agreement signed by the signatory countries of the
United Nations Climate Change Conference, which set targets for reducing greenhouse gas emissions applicable exclusively to
developed countries, considered to be the main contributors to the accumulation of emissions in the atmosphere since the
Second Industrial Revolution. Developed countries also committed to financing the adoption of "clean" technologies by
developing countries. The Brazilian delegation contributed to the creation of the
Clean Development Mechanism, the basis for the creation of a global carbon market with the aim of stimulating the financing of projects to reduce greenhouse gas emissions. The FHC administration created the
Brazilian Climate Change Forum (
Fórum Brasileiro de Mudanças Climáticas) to carry out studies, advise the president and mobilize society's attention to the phenomenon identified in successive
IPCC reports. The main laws associated with environmental policies created during the FHC government were: • National Water Resources Policy (
Política Nacional de Recursos Hídricos - PNRH): established by the Water Law of 1997 and regulated by the National Water Agency (
Agência Nacional de Águas - ANA), created in 2000. It introduced a national water resources management system and river basin committees and defined water as a public good and a scarce resource whose use must be charged to private individuals; • Environmental Crimes Law: established sanctions that enabled the implementation and effective enforcement of the entire set of legislation related to the environment; •
National System of Conservation Units Law: defined 12 categories of
Conservation Units with different degrees of preservation and sustainable use to improve their integrated planning.
Sports The FHC government was responsible for creating the Extraordinary
Ministry of Sports in 1995, with
Pelé as its first minister. Under his guidance, the General Sports Law, also known as the
Pelé Law, was created to deal with the democratization of sporting activities, freedom to practice sports and safety for practitioners of any sport. In 2019, the ministry was abolished by
Jair Bolsonaro, but was reactivated by the
Lula administration in 2023.
Education The FHC government created and implemented the
Educational Information and Evaluation System (
Sistema de Informações e Avaliação Educacional) in order to provide information and evaluate the quality of education at all levels and modalities. The government focused on universalizing
primary education through the
Fund for the Maintenance and Development of Primary Education and the Valorization of the Teaching Profession (
Fundo de Manutenção e Desenvolvimento do Ensino Fundamental e Valorização do Magistério - FUNDEF), which allocated compulsory spending on education to primary education and distributed the funds to the municipalities. Important laws and documents designed to organize, plan and create coherence in Brazil's educational policy were produced, such as the
Law of Guidelines and Bases and the National Curriculum Parameters in 1997 and the National Education Plan in 2001.
Social policies In 1995, the Brazilian delegation, led by First Lady
Ruth Cardoso, participated in the
Beijing Conference organized by the
United Nations. The event established an action program for gender equality and set a timetable for monitoring its implementation every five years. In the same year, the first legislation on quotas for women in elections in Brazil was approved with a minimum percentage of women candidates. The FHC government also launched a program to combat violence against women, promoting the expansion of specialized women's police stations and shelters. In the second term, gender discrimination in the job market was banned by law and sexual harassment was typified and penalized. The 1916 Civil Code was replaced in
2002 to reflect the principle of equal rights and obligations between men and women in family relationships, including reproductive planning. In 2002, FHC created the State Secretariat for Women's Rights (
Secretaria de Estado dos Direitos da Mulher - Sedim). In 1995, the
Brazilian Gay, Lesbian, Bisexual, Travesti, Transsexual and Intersex Association (
Associação Brasileira de Lésbicas, Gays, Bissexuais, Travestis, Transexuais e Intersexos - ABGLT) was created to unite the different organizations and groups of the movement nationwide. The first Gay Pride Parade, now known as the
LGBT Pride Parade, was organized by the association. The FHC government created Laws No. 10.048 and No. 10.098, which established issues relating to priority service and basic standards and criteria for promoting accessibility for people with disabilities or reduced mobility, respectively. The National Policy for the Integration of People with Disabilities (
Política Nacional para a Integração da Pessoa Portadora de Deficiência) and the National Health Policy for People with Disabilities (
Política Nacional de Saúde da Pessoa Portadora de Deficiência) were also implemented. The
Brazilian Sign Language (Libras) was recognized as an official language. In 1995, the
International Labour Organization (ILO), in partnership with the federal government, sent a delegation to Brazil to study the problem of racial discrimination in the labor market. Initiatives such as the Brazil, Gender and Race Program (
Programa Brasil, Gênero e Raça), aimed at combating racism in labor relations, emerged from this project. In the same year, the Zumbi dos Palmares March against Racism, for Citizenship and Life was held in Brasilia to commemorate the 300th anniversary of
Zumbi's death. The Interministerial Working Group for the Valorization of the Black Population (
Grupo de Trabalho Interministerial para Valorização da População Negra - GTI) and the National Coordination for the Articulation of Black Rural Quilombola Communities (
Coordenação Nacional de Articulação das Comunidades Rurais Negras Quilombolas - Conaq) were also created. In 1996, the FHC government launched the 1st National Human Rights Program (PNDH) with proposals aimed at combating racial discrimination. In the same year, discussions began on specific affirmative action for Brazil at the Multiculturalism and Racism Seminar.
Relations with the National Congress During his election campaign in 1994, Fernando Henrique Cardoso was supported by the
Liberal Front Party (PFL) and the
Brazilian Labor Party (PTB). Initially, his vice-president would be
Guilherme Palmeira, a PFL candidate, but he was replaced by
Marco Maciel after accusations of favoritism from a contractor. Upon winning the election, his coalition secured 36% and 30% of the disputed seats in the
House and
Senate respectively. After the
Brazilian Democratic Movement Party (PMDB) joined, the ruling base increased to 57% and 58%. The PFL received the
Ministries of Mines and Energy and the
Environment, the PMDB received the Secretariat for National Integration, the PTB received the
Ministry of Agriculture and the PSDB got the
Ministry of Planning,
Justice and the economic team that implemented the Real Plan. At the end of 1995, Fernando Henrique Cardoso chose
Francisco Dornelles, a deputy from the
Brazilian Progressive Party (PPB), to occupy the
Ministry of Development, Industry, Trade and Services, which he assumed in May 1996. FHC claimed that this represented a formal joining of the PPB in the government, but relevant members of the party including
Paulo Maluf criticized him. In 1997, FHC renewed the alliance with the PMDB and PFL in Congress, supporting the election of a PMDB deputy from São Paulo,
Michel Temer, and a PFL senator from
Bahia,
Antônio Carlos Magalhães. In 1997, the constitutional amendment allowing re-election to executive positions was approved; the PSDB, PFL, PTB, PMDB and PPB supported the re-election of Fernando Henrique Cardoso. In 1999, the federal government supported the nomination of Michel Temer and ACM to the presidency of the Lower and Upper Houses of Congress respectively. In 2000, there was a conflict between Fernando Henrique Cardoso and his allies in Congress. He promised that he would veto the candidacy of
Aécio Neves for the presidency of the Chamber of Deputies and that he would support
Inocêncio de Oliveira, a PFL deputy. He also claimed neutrality in the Federal Senate, where
Jader Barbalho, from the PMDB and ACM's rival, was articulating his election to the presidency of the House. However, Aécio Neves formed a strong alliance in the Chamber of Deputies and FHC refused to intervene. The PFL threatened to leave the coalition, but FHC offered them an ultimatum: they could either retreat or he would exonerate the ministries that the PFL held at the time. The PFL remained in the coalition, but its relationship with the federal government deteriorated. In 2001, Aécio Neves was elected President of the Chamber of Deputies and Jader Barbalho was appointed President of the Senate. In 2002, the PFL and PTB left the ruling coalition and handed over their ministries to launch presidential candidates. The PMDB still remained allied with the government and supported former Minister of Health
José Serra's candidate for the presidency, with the PMDB deputy from Espírito Santo,
Rita Camata, as his vice-president.
Impeachment attempts Fernando Henrique Cardoso suffered seventeen accusations which could lead to his impeachment if proven. The complaints were filed more frequently during his second term, but were dismissed.
Appointments to the Supreme Court As president, Fernando Henrique Cardoso appointed the following judges to the Supreme Court: • 1997 -
Nelson Jobim; • 2000 -
Ellen Gracie; • 2002 -
Gilmar Mendes. == Foreign policy ==