Brazils worst kept secret. José Serra, the 68-year-old governor of São Paulo a man who has dreamt of becoming president since he was a teenager might just possibly be standing as a presidential candidate.
The ambitious politician from the social democratic party (PSDB), who was defeated by president Luiz Inácio Lula da Silva in a run-off vote in 2002, is poised perhaps to launch another presidential bid. This time its against Dilma Rousseff, president Lulas chief of staff. Serra has enjoyed broad support from his party, especially after another contender, Aécio Neves, governor of Minas Gerais, dropped out of the race.
But so far, Serra isnt saying anything.
He intends waiting as long as possible before entering the electoral arena possibly until early April, six months before polling day. Meanwhile the incumbents candidate, Rousseff, is gaining popularity, according to opinion polls, thanks to Lulas wholehearted support.
Nevertheless, to those who press him to rush to the battleground, Serra says he has nerves of steel.
It is difficult to know what is going through Serras mind, says Eduardo Bernini, a former head of the energy company AES in São Paulo, who has dealt closely with politicians.
Even though financial markets have come to like Lula, they are now much more sympathetic to Serras economic policies than Rousseffs, according to a JP Morgan report. It says: While the governments candidate will probably strengthen a development model based on a strong state and on public intervention in the private sector, long-term issues would be better dealt with by the opposition candidate.
Serras fiscal record is strong, and this is expected to make a difference. His policy options will include a strong fiscal adjustment, especially at the beginning of his term. In turn, the fiscal space would help loosen monetary policy, pave the way for a depreciation of the exchange rate and address the thorny issue of the current account gap.
He could improve the quality of the management of the state, says Maílson da Nóbrega, a former finance minister. Nevertheless, this may not be easily implemented as Serra would have to rely on a solid majority in Congress to pass fiscal reforms.
Serra, a long-time critic of high interest rates and the appreciation of the Brazilian currency in the foreign exchange markets, is not expected to make any radical moves. I cannot imagine Serra telling the central bank to cut interest rates. This would trigger a confidence crisis. Hes not silly. Hes a very experienced politician, says Nóbrega.