Brazil’s da Silva forms mixed economics team for transition

BRASILIA, Brazil (AP) — President-elect Luiz Inácio Lula da Silva’s transition added a team of economists Tuesday that includes at least two members likely to allay market worries about potential business and financial policies the incoming leftist leader might be considering.

Investors look favorably on André Lara Resende and Pérsio Arida, conservative economists who were among the architects of the Real Plan in the 1990s that implemented a new Brazilian currency and tamed hyperinflation.

The other two economists on the transition team are Nelson Barbosa, who was finance minister under President Dilma Rousseff of da Silva’s Workers’ Party, and Guilherme Mello, an economics professor who has long been known as the Worker’s Party economist.

“They don’t have opposing views. They’re complementary,” Vice President-elect Geraldo Alckmin told reporters during the announcement in the capital, Brasilia.

Alckmin said people involved in the transition won’t necessarily join the administration after da Silva is inaugurated Jan. 1 for his third term as president — he also held the office in 2003-2010.

Still, those chosen to work in the transition give an idea of how da Silva, who is universally known to Brazilians as Lula, intends to conduct economic policy.

His first two terms coincided with a surge in demand for commodities that helped spur a Brazilian economic boom and filled the government's tax coffers. This time, da Silva will face a more adverse global economy, fierce political opposition and limited room to maneuver with a strained government budget.

Among the most pressing challenges is making good on his pledge to sustain a vast welfare program and boost spending on health and education without exceeding a constitutionally imposed spending cap. He also needs to...