The document is Burson-Marsteller's February 2018 monthly newsletter. It provides an overview of Burson-Marsteller, a global public relations and public affairs firm. The newsletter also profiles the latest political developments in Brazil, including updates on presidential candidate Ciro Gomes and changes to electoral campaign financing laws. Additionally, it discusses the military intervention in Rio de Janeiro and divisions within Brazil's security and justice sectors.

1. Monthly Newsletter
Burson-Marsteller
February
Public Affairs
2018

2. Burson-Marsteller l Public Affairs
An intersecting agency that, through the understanding of the political environment,
assists clients of different sectors in the protection and/or promotion of their businesses,
managing their influence in a sustainable way.
The Burson-Marsteller standard is responsible for the development of highly customized
projects, according to the needs of each client, developing strategies for various economic
sectors, especially those heavily regulated by the government.
Contributors to this edition
Index
Year 2 | Nº 02 | February
Luciana
Lemgruber
Fernanda
Xavier
Isabela
Girotto
Isabela
Macêdo
Anna
Paula Losi
Allana
Rodrigues
Bruno
Traversin
02 Politics | Presidential candidates: Once again, Ciro Gomes
03
04
05
06
07
08
09
Politics| Electoral changes: campaign self-financing
Politics |Military intervention: need X political strategy
Politics | Security and Justice: the new power division
Politics | The migratory flow in Roraima and the reflexes of
the Venezuelan crisis
International Relations | Jacob Zuma, rise and fall
Economic Data
Events Calendar

3. The latest movements of the presidential candidate Ciro Gomes (PDT / CE) have been indicating
his commitment to consolidate himself as a center-left alternative in the 2018 elections,
especially in a scenario in which former president Luis Inácio Lula da Silva is prevented from
running, due to the compliance with the Clean Sheet Act. He has sought support from PSB
(Brazilian Socialist Party), to which he has been affiliated, and from PCdoB (Brazil’s Communist
Party).
Ciro has avoided expressing himself more harshly against the PT (Worker’s Party) and said not to
rule out an alliance with the party, although he believes that there are no real chances of an
agreement between Lula’s party and his. However, on February 21, the former governor of Ceara
met with Fernando Haddad (PT/SP), in what is said to have been an invitation for the former
mayor of Sao Paulo to run as Gome’s vice-president. Lula would have given the approval for
Haddad to initiate composition talks with Ciro to build a center-left alliance that could unify the
votes in the case of his non-candidacy.
While the definitions of his election ticket cover most of the headlines about him, Ciro Gomes has
also been notable for his participation in several pre-campaign events. In many of them, he has
focused on criticizing recent measures by the government of President Michel Temer, such as the
intervention in the state of Rio de Janeiro and the economic agenda presented in place of the
Pension Reform that will not be voted after all. Of the 15 proposals submitted by the
government, Gomes emphasized that he is firmly to the privatization of Eletrobras and the
autonomy of the Central Bank.
In the proposals of the pre-candidate, reinforces the importance of Brazilian state and industrial
development with government incentive, and always emphasizes that believes in the decline of
interest rates to stimulate the economy. Gomes argues that his history demonstrates his
commitment to fiscal austerity, citing as an example the work carried out as the head of the
government in Ceara. Regarding social security, Ciro Gomes acknowledges the need to carry out
a pension reform, but not in the ways presented by the current government, but based on
capitalization.
Among other measures, Ciro Gomes proposes:
▪ Oil and gas: aims to encourage the exploitation of materials and use to supply the internal
market;
▪ Increase the national production of medicines, medical machines and prostheses;
▪ Invest in the formation of an agribusiness industrial complex to make the sector more
competitive internationally;
▪ Implement taxation on profits and dividends;
Politics
Presidential candidates: Once again,
Ciro Gomes
02

4. In a wide pre-campaign, during lectures and interviews, Ciro Gomes has defended his
developmental economic proposal with dedication, as well as has been repeating being a center-
left alternative to Brazil. His ticket must yet be defined, which also depends on the definition of
the PT on his speech to keep Lula as a candidate, without any "plan B". Meanwhile, Fernando
Haddad moves by himself and leaves open the possibility for what Ciro Gomes has already called
the dream team for the 2018 elections.
Isabela Macedo
Politics
03
Electoral changes:
campaign self-financing
The Brazilian politics, permeated by situations of explicit corruption, popular manifestations and
the lack of identification of the people in relation to the rulers, made the scene of changes
become more and more necessary. In this context, not only politically but also economically,
actions based on reforms and changes in the modus operandi of the government were
perceptible. In this range, it is possible to include the called "Electoral Mini-Reform", approved in
the National Congress in 2015, and which made possible several changes, for the first time, in
the municipal elections of 2016.
Regarding these changes in the electoral rules, it is possible to highlight changes in the duration
of the campaign, spending limit, time of party affiliation for candidacy and, mainly, the
prohibition of corporate financing. On the latter point, elections should be financed by the Party
Fund or donations of civils (10% of the donor's gross income in the previous year to the
election).
The controversial ban caused, according to the Superior Electoral Court (TSE, in Portuguese), in
the 2016 elections, the lowest collection: in 2012, in the first round, R$ 7.2 billion was donated,
while in the last elections in 2016, only R $ 2.5 billion. In this scenario, we noticed a significant
number of candidates who donated money for their own campaigns, also called self-financing.
Thus, The Supreme Electoral Tribunal (TSE) published, this month, a resolution that allows
candidates to use their own resources in their campaigns up to the limit of expenses established
for the position to which they compete. This way, candidates will be able to fund 100% of their
campaigns.
However, it should be noted that unrestricted self-financing, despite the resolution published by
the TSE, is still being discussed in the Federal Supreme Court (STF, in Portuguese), by of the
Rapporteur Dias Toffoli, who can submit a report on the suspension of the rule and the
application to candidates of the same donation limit for individuals, 10% of gross income in the
previous year to the election.

5. The measure has several controversies including the beneficiation of candidates with greater
purchasing power. In this context, the government doesn’t have a unified opinion. President
Michel Temer, in October, released unrestricted self-financing, but the National Congress
overturned his decision. In this imbalance, some parties, such as the PSB and REDE, have
manifested themselves, in the Federal Supreme Court, regarding the unconstitutionality of the
resolution.
It is visible, once again, the divergences between the Branches and the pursuit of self-interests.
TSE has until March 5 to review unrestricted self-financing. If there are no changes, funding from
own resources will be valid for this year's elections, and the impact on smaller party campaigns
can be considerable. Let’s wait for the next episodes!
Isabela Girotto
Politics
04
As Brazil woke up to the hangover of the carnival, Planalto Palace launched its biggest political
move since the current president took office. From an idea already showed of the creation of a
ministerial folder for the public security, led by Jungmann, a series of events, also old, gave start
to one of the better tailored measures of Michel Temer: the military intervention in the security
of the State of Rio de Janeiro.
On the eve of another attempt to vote the Government's biggest banner, the Social Security
Reform, here is a very serious situation of public safety in one of the most important Brazilian
states. The scenario is serious, but would it be the most complex situation in Brazil in the last
thirty years?
After hurried journeys, urgent meetings and friction between the Branches, the actors of the
controversial measure buried Social Security reform, until then the emblem of the current
mandate, and used for the first time in history a constitutional device that placed an active Army
general in command of the Public Security of Rio.
Federal intervention is a constitutional tool and therefore legitimate, since under the
circumstances provided by the Constitution. However, in view of this singular intervention, the
idea arises that the purpose of the decree would be political. It aims to suspend the voting on
the pension reform, provoking the incidence of § 1 of art. 60 until the government is able to
guarantee the quorum required for its approval. Once the quorum was accomplished, the
intervention would be suspended, according to the President himself.
However, the Brazilian constitutional text is clear and determinates that the measure should be
closed only with the end of its period described in the decree or with the loss of its object. In
other words, it is not possible, constitutionally, that a measure of this size simply pause due to
the will of the President. And it was precisely in this sense that, shortly after the declaration of
the President of the Republic, the Supreme Court manifested.
Military intervention: need X political
strategy

6. With the Social Security Reform out of agenda, Temer continues the way he has been since he
took power: extinguishing fires and surviving chaos. Without the support of the people or the
Congress, the government keeps itself in risky, controversial and dubious maneuvers, the oxygen
until the end of the mandate. Only the future will point to the true cause of the intervention. If
the violence of the State of Rio de Janeiro continues during and after the end of the intervention,
it will be corroborated the thesis that the intervention decree did not really aim to "put an end to
the serious compromise of public order.“
Luciana Lemgruber
Politics
05
Security and Justice: the new power
division
The current uncontrolled and chaotic scenario that the state of Rio de Janeiro faces in the area
of ​​public security, demanded an energetic measure of the federal government, thus decreeing a
federal intervention in this state. The announcement, which took place on the 16th of this
month, brought the announcement of the creation of the Ministry of Public Security, in addition
to the passage from command of the public security to the armed forces, and consequently
reduction of the scope of the current Ministry of Justice.
President Michel Temer, during the announcement of the federal intervention, presented the
creation of the Ministry of Public Security, which will be made through a Provisional Measure and
will need to be voted by the National Congress. To command the new Ministry, the Federal
Government found a "home-made" solution, appointing former Defense Minister Raul Jungmann
to take over the briefcase.
According to the president, the new ministry will coordinate public security throughout the
country without invading the competence of other Ministries (in this case, the Ministry of Justice)
and, because of its extraordinary creation, may be extinguished at any time. The briefcase
should take control of the Federal Police, Federal Highway Police, National Force, National
Penitentiary Department and the Public Security Department, thus removing several agencies
from the hierarchy of the Ministry of Justice.
It will be left to the defunct Ministry of Justice, the development of preventive policies to combat
drugs and asset recovery programs abroad, caring for foreigners and refugees, cartels and
consumer protection.
The justification for the creation of this new Ministry would be to respond to the violence faced
by the population of Rio de Janeiro, but it seems that there are also some "less noble" causes
involving the creation of this portfolio, thus making the discussion of federal intervention
something bigger than only the concern with public safety. Moreover, this measure go against
the president's speech, when he took over his current position, that there would be a reduction
of the public machine.

7. As soon as he took over the new Ministry, Raul Jungmann has already taken his first strongest
step, dismissing the current "chief" of the Federal Police, Fernando Segovia. In order to take over
the position left by Segovia, Raul Jungmann chose delegate Rogério Galloro, an important
exchange in the chain of command, at a time when the PF is investigating President Michel
Temer and several politicians.
Bruno Traversin
Politics
06
The migratory flow in Roraima and the
reflexes of the Venezuelan crisis
In the face of the economic, social and political crisis that Venezuela faces, thousands of
Venezuelan citizens see Brazil as the only way out for employment and new opportunities. The
main gateway for migrants is the state of Roraima, whose migration flow has led to the status of
"situation of vulnerability", according to a decree signed by President Temer this month.
The decree covers several social areas, such as health, education and food supply. The
government also created the Federal Emergency Assistance Committee, which will be responsible
for accommodating people susceptible to the situation of vulnerability due to migratory flows
caused by humanitarian crisis.
Mass immigration has left Roraima's public service overwhelmed, especially the health one. In
addition, the state is under alert of a possible outbreak of measles, after the diagnosis of the
disease in a Venezuelan child of one year of age; the virus, however, had been eradicated in
Brazil since 2015.
Due to the problems arising from migration in Roraima, state parliamentarians spoke about the
issue. Senator Telmario Mota (PDT), in a speech to the Plenary, said that it is necessary to make
a kind of "screening" of migrants, so that the state does not face worse crises in the future.
The idea defended by the Senator is supported by the Minister of Justice, Torquato Jardim, who
stated that it is necessary to make a distinction of the needs of each migrant, since some of
them need medical assistance and others need help to get a job.
The Representative Sheridan Oliveira (PSDB), also from Roraima, gave her speech regarding the
health sector, and said that the social collapse that the state faces was already predictable, since
it is one of the poorest in the country and, consequently, does not have enough structure to
accommodate the number of Brazilian citizens and now the Venezuelans.
It is expected that the decree will bring celerity in the provision of resources to be destined in
infrastructure works, besides investments for basic services and to the population. However, in
relation to Venezuela, it is still uncertain to say when and what will be the outcome of a crisis
that has generated impacts that go beyond its territorial borders.
Fernanda Xavier

8. On 14 February, former South African President Jacob Zuma announced his resignation from the
country's top executive position. From a notorious supporter of the end of apartheid to president
of one of the richest and most developed African countries, Zuma's trajectory is marked by his
heroic role in the overthrow of one of the most evident racist regimes in contemporary history
and the decline due to hundreds of corruption charges.
Jacob Zuma was born in the 1940s and joined the African National Congress (CNA), the country's
most important party since the end of apartheid in 1958. By virtue of his struggle against racial
segregation, in 1963 Zuma was sentenced to ten years of prison, during this time he was
imprisoned with Nelson Mandela. Subsequently, and more precisely, in 1973 Zuma was released
and, after the end of the segregationist regime, he was led to the vice-presidency of South Africa
in 1999.
Among accusations of corruption and rape, in addition to being removed from the vice-
presidency in 2005, and after being led to the party's presidency in 2007, Zuma reached the
highest political post in the country. Since then, no less than 783 allegations of corruption and
fraud have been attributed to him.
To understand the scenario that led to the resignation of Jacob Zuma, it is also worth
highlighting the relevance of CNA. Created in 1912, it was after the end of apartheid in 1999 that
the CNA became the country's leading party and political force. Since then, the party has won all
presidential elections and governs most of South African cities. However, the municipal elections
of 2016 showed the first signs of weakening, resulting from successive corruption accusations
against Zuma and the growing level of dissatisfaction among the general electorate, but
especially younger voters.
As in Brazil and around in the world, the direct result of political instability is the decline in
foreign investment. What comes from the "escape" of investors is also implicit, crisis in several
sectors of the economy. In addition, the Zuma government demonstrated a relentless political
project, marked by the tendency to overthrow those who threatened his stability in power. The
combined effect of all these factors is the right recipe for deposition, it was no different in South
Africa.
The South African political system is parliamentarian, that is, the parliament chooses the
president, not the population in a direct way, and holds the prerogative of deposition. This
should not have been an obstacle for Zuma, since his party is majority in the parliament.
However, it was the internal issues of CNA that forced the president’s resignation, who was
despised among his own.
His successor, former Vice President Cyril Ramaphosa has also been an anti-apartheid activist
and has a tough road ahead: he needs to reduce the fiscal deficit and stabilize the debts, besides
resuming GDP growth. However, just as in Brazil, the post-fall scenario of President Jacob Zuma
demands political consistency and hard measures that re-establish the trust of society and
entrepreneurs. It was not what we saw on this side of the Atlantic and the expectations are
similar for the south African country.
Allana Rodrigues
International Relations
07
Jacob Zuma, rise and fall

9. Economic Data
08
MONTH DOLAR
IPCA
(acummulated
during the last
12 months)
SELIC IBOVESPA
GDP
PROJECTION
2018
MAY.2017 3,26 3,77% 11,25% 63.906,99 0,5%
JUN.2017 3,30 3,00% 10,25% 62.238,95 0,39%
JUL.2017 3,15 2,71% 9,25% 65.316,30 0,34%
AUG.2017 3,14 2,46% 9,15% 70.727,08 0,39%
SEP.2017 3,17 2,54% 7% 73.626 0,68%
OCT.2017 3,26 3,08% 7% 73.323 0,73%
NOV.2017 3,27 3,08% 7% 71.971 0,73%
DEC. 2017 3,31 2,79% 6,9% 75.996,68 0,98%
JAN. 2018 3,17 3,95% 6,75% 85.329,20 2,66%
FEB. 2018 3,24 4,01% 6,75% 86.000,80 2,89%
Source: Boletim Focus/Banco Central

10. Events Calendar
SUN MON TUE WED THU FRI SAT
25 26 27 28 1 2 3
4 5 6 7 8 9 10
11 12 13 14 15 16 17
Ordinary Meeting
of the Board of
ANVISA
Local: Brasilia, Brazil
IBusiness 2018
Local: Parana, Brazil
09
3rd Brasscom Seminar Public Policy & Business
Local: Brasilia, Brazil
Ordinary Meeting
of the Board of
ANVISA
Local: Brasilia, Brazil
Seminar and Workshop "Transfer pricing: the OECD
standard and the Brazilian approach“
Local: Brasilia, Brazil
CONITEC Meeting CONITEC Meeting
Meeting of the
Sectoral Chamber
of the Citrus
Productive Chain
Local: Brasilia, Brazil
Meeting of the
Sectorial Chamber
of Planted Forests
Local: Brasilia, Brazil
Mobile World Congress 2018
Local: Barcelona, Spain
1st National Conference on Health Surveillance 2018
Local: Brasilia, Brazil
18 19 20 21 22 23 24
25 26 27 28 29 30 31
Ordinary Meeting
of the Board of
ANVISA
Local: Brasilia, Brazil
UK Energy in
Brazil 2018
Local: Rio de
Janeiro
Tele.Sintese
Meetings
Local: Brasilia, Brasil
Workshop de
Digital Publishing
Brasil 2018
Local: Sao Paulo,
Brasil
Meeting of the
Sectoral Chamber
of the Sugar and
Alcohol Productive
Chain
Local: Brasilia, Brasil
Seminar of
Supplementary
Health
Local: Brasilia, Brasil
I Brazilian Congress of Neurogenetics
Local: Sao Paulo, Brasil
Meeting of the
Thematic Chamber
of Credit,
Marketing and
Insurance of
Agribusiness
Local: Brasilia, Brasil
Commented
Readings Cycle -
Internet
Governance: past,
present and future
- Meeting 1
Local: Sao Paulo,
Brasil
Meeting of the
Sectorial Chamber
of the Cocoa
Productive Chain
Local: Ilheus, Bahia
Ordinary Meeting
of the Board of
ANVISA
Local: Brasilia, Brazil