Tarcísio says his vision for Brazil differs from Lula's, calls for softer adjustment than Milei's

São Paulo Governor Tarcísio de Freitas declared on Tuesday that his vision for Brazil diverges from that of President Luiz Inácio Lula da Silva. Speaking at the annual Santander bank conference in São Paulo, Freitas expressed concern that the federal government's handling of public debt could hinder national growth and São Paulo's development.

"We do not have a convergent vision of Brazil," Freitas stated, emphasizing that the current year presents an opportunity to advocate for a national project. He proposed a "much softer" fiscal adjustment than the one implemented by Argentina's Javier Milei, which he described as 15% of GDP. Freitas warned that without proper management of public finances, Brazil risks a significant downturn.

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We do not have a convergent vision of Brazil.

Freitas also discussed the Propag program, which renegotiates state debts with the federal government. He credited governors from the South and Southeast regions for initiating the proposal, which was later sanctioned by President Lula in January 2025. Freitas noted that São Paulo's debt had "unreasonable" conditions prior to the renegotiation, which has since freed up budget space.

He asserted that São Paulo's public accounts are now in order, with the state's debt trending downward relative to its net current revenue. Freitas attributed this improvement to measures such as administrative reform, the dissolution of eight state-owned companies, privatizations, concessions, and tax settlement programs. These actions, he explained, have increased the state's investment capacity from an annual average of R$8 billion to R$12 billion to approximately R$30 billion to R$32 billion.

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Nobody is asking for Milei's fiscal adjustment, 15% of GDP. We don't need that. A much softer adjustment will bring down our debt trajectory and solve our problem. It's an explosion of capital that will arrive here.