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Home / Business

72,000 jobs wiped out in one blow; Brazil in economic, social and political crisis

By Matt Young
news.com.au·
5 Jun, 2018 09:39 PM4 mins to read

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Trucks sit idle at the largest food market in Latin America, in Sao Paulo, Brazil. Photo / AP

Trucks sit idle at the largest food market in Latin America, in Sao Paulo, Brazil. Photo / AP

Amid political and social chaos, Brazil has been described as being in the midst of a "zombie apocalypse" as years of violence and corruption finally implodes.

The country is in such a state of turmoil that is has been described by some reporters as "entering the eye of the hurricane again" after an estimated 32 billion reais ($11.18 billion) in economic losses.

But the crisis has reached far beyond diplomatic circles. The turmoil hit the streets and, by the end of last month, 99 per cent of Sao Paulo's petrol stations had run out of petrol.

On top of that, disgruntled workers blocked highways and halted shipments, leaving an entire country almost completely stranded.

Public transport, school, garbage collection, public services and power plants had all shut down. Medicine was in short supply. Hundreds of cities declared states of emergency as fuel and food ran out, and more than 10 airports were compelled to cancel flights.

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South America's biggest city, Sao Paulo, was a ghost town; devoid of cars, people, community.

"We will not allow consumers to go without products, we will not allow hospitals to go without what they need to save lives, we will not allow children to be harmed by the closure of schools," Brazilian President Michel Temer said in a televised statement.

Still, disaster ensued.

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People sit with their containers as they wait at a gas station that is expecting a delivery to refuel, in Sao Paulo, Brazil. Photo / AP
People sit with their containers as they wait at a gas station that is expecting a delivery to refuel, in Sao Paulo, Brazil. Photo / AP

The most recent developments were thanks to an 11-day truckers' strike that quickly spiralled out of control, leaving the country starved of its most basic necessities: food, water and fuel.

"The government handled this strike so badly," said Lorivan Carvalho, a federal employee who spent two hours waiting in a line of cars at a gas station in capital Brasilia.

Brazilian President Michel Temer hiked diesel prices by 10 per cent. The truckers protested. According to one of the country's daily newspapers, Folha de S Paulo, the number of trucks on Brazilian roads fell by 26 per cent between 2003 and 2007. In the two years between 2014 and 2016, 72,000 truckers' jobs were wiped out.

"It made perfect sense that Brazilian truck drivers, many of them self-employed, would protest the increase in diesel prices," wrote Kenneth Rapoza for Forbes.

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"To them, it was more money going to more crooked politicians, and coming out of their pockets.

"Political risk coupled with the impact of the truckers' strike is going to pull the rug out from under Brazil."

The domino effect took hold. Production halted. Food became scarce. Jets couldn't fly. Chickens began eating themselves. Seventy million of them were killed, despite farmers running out of space to dispose of their carcasses. Almost 4000 beef trucks were sitting stationary along road sides in Brazil with their meat rotting away inside.

Brazil's animal protein association warned 20 million pigs were also in the firing line.

Truckers block the federal highway to protest rising fuel costs, in Embu das Artes, on the outskirts of Sao Paulo, Brazil. Photo / AP
Truckers block the federal highway to protest rising fuel costs, in Embu das Artes, on the outskirts of Sao Paulo, Brazil. Photo / AP

"The strike over high fuel prices has paralysed Brazil, the top global exporter of soybeans, sugar, coffee and chicken," Reuters reported last week.

Capped by the surprise resignation of the CEO of the state-controlled oil producer Petrobras, Pedro Parente, over fuel pricing policies, it's been a rough climax for the country, which according to one expert, has "obliterated faith in democracy" and paved the way for political and social upheaval.

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Elections in October are providing no relief for an end in sight; according to Americas Quarterly most voters "profess little faith in any of the candidates" after suffering through years of corruption.

There is hope on the horizon. Last week the government reinstated the fuel subsidies and outgoing President Michel Temer — the first Brazilian president ever to be charged with a crime while in office — will end his reign in just two months which can only be a good thing for the country, considering his five per cent approval rating.

But will it fix democracy? With phrases like "End of Days" from those on the ground, the future looks bleak. Time will tell.

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