Brazil Senate committee vote set on Rousseff impeachment

Brasília (AFP) –


A special committee in Brazil's Senate was to vote Friday on whether to recommend starting an impeachment trial against President Dilma Rousseff who faces being suspended from office in less than a week.

The committee's vote is non-binding but marks the last formal stage before the full Senate votes Wednesday on starting a trial and suspending the leftist president.

With a 'yes' vote almost certain, Rousseff is preparing to step aside for up to six months while her trial takes place, plunging Brazil into ever deeper political infighting.

As soon as Rousseff is suspended Vice President Michel Temer, a center-right politician whose party recently broke off its shaky alliance with Rousseff's Workers' Party, would become interim president.

The impeachment battle, a crumbling economy, and corruption probes against dozens of leading politicians and business executives have left Latin America's biggest country in turmoil ahead of the Rio Olympics this August.

The impeachment is based on accusations that Rousseff made illegal accounting maneuvers to mask the depth of Brazil's economic troubles during her tight 2014 reelection victory.

- Corruption whirlpool -

The country's first female president says the charges are trumped up to turn the impeachment process into a coup d'etat. She has vowed to resist to the end.

While Rousseff fights for her political survival, both her closest allies and some of her most bitter enemies are being sucked into an ever deepening corruption scandal centered on state oil company Petrobras.

On Thursday, the architect of the impeachment drive, lawmaker Eduardo Cunha, was suspended by the Supreme Court from his post as speaker of the lower house on grounds that he was obstructing a Petrobras-related corruption probe against him.

Cunha was one of Brazil's most powerful political operators and allied to Temer. His probable replacement in the speaker's post is another lawmaker accused of participating in the Petrobras embezzlement ring.

- Paralysis -

Temer himself is not being probed in the Petrobras affair, the chief prosecutor said this week, despite allegations made against him by a key witness in the government's case.

However, in yet another twist Thursday it emerged that Temer could be barred from participating in any elections for eight years because he has been found guilty of violating campaign finance rules. The ban would not affect Temer's ability to take the presidency next week since no election is involved.

Meanwhile, the government and Congress have all but come to a standstill, with measures to try and drag the economy out of its worst recession in decades abandoned.

On Thursday, Fitch followed other rating agencies in downgrading Brazil's credit score.

It was already classed as speculative or "junk" grade and on Thursday Fitch shifted the rating down to BB from BB+.

The downgrade "reflects the deeper-than-anticipated economic contraction, failure of the government to stabilize the outlook for public finances and the sustained legislative gridlock and elevated political uncertainty," Fitch said.

The economy shrank 3.8 percent last year and is forecast to wither away at the same rate this year before flattening out with zero growth in 2017.

That's a huge drop from the 7.5 percent growth Rousseff inherited when she first took office in 2010, although a big reason for the decline was the end of high commodity prices around the world.

Markets are betting on a Temer presidency breaking the deadlock in Congress and ushering Brazil back out of the red.