Storming of Brazil's Government Buildings Underscores Risks To Social Stability

• On January 8, 2023, supporters of former conservative President Jair Bolsonaro broke into the Congress, the Supreme Court and the presidential palace in Brasilia. This happened following the inauguration of left-wing President Luiz Inácio Lula da Silva (Lula) on January 1.
• The storming of government buildings appears to be a delayed reaction to Lula’s narrow victory on October 30, after which Bolsonaro challenged the results of the presidential run-off election.
• Notably, Fitch forecasted that protests by Bolsonaro’s supporters have increased the risk of disruptive demonstrations. In the event of persistent and violent protests, the Agency would lower Brazil’s score in its Short-Term Political Risk Index (STPRI), specifically in the ‘social stability’ component score, which is currently 40 out of 100. The overall score stands at 53.3 out of 100.
• The forced entry by protesters into Brazil’s key federal government buildings reveals serious security breaches and increased risk to social stability as many of Bolsonaro’s supporters do not accept the presidential election outcome.
• Despite the peaceful transfer of power during the inauguration of President Lula, the violent protests demonstrate the deep polarisation and division that Brazil is facing.

(Source: Fitch Solutions)