Rough Road Ahead for Rousseff

Unstable, corrupt, plagued by scandal—these describe Brazil’s current economic and political climate, a big transformation from its image of an advancing economy with secure investment opportunities.  How did Brazil, one of the BRICS (Brazil, Russia, India, China, & South Africa) countries, go from boom to bust so rapidly?

It begins with Petróleo Brasileiro S.A. (Petrobras), the semi-public Brazilian energy corporation that has recently been mired in scandals.  In September 2013, Petrobras reported the largest debt of all global oil producers.  It was later uncovered that Petrobras inflated the value of service contracts and funneled the excess funds into its executives’ bank accounts and to political party members.  Alleged culprits include the treasurer of the Workers’ Party, the sitting President’s political party, and high-ranking members of Brazil’s congress.  There are also allegations that Brazilian President Dilma Rousseff, who was Petrobras’ Chairwoman from 2003 to 2010, was involved in this corruption, though there is currently no evidence to back these claims.