November 11, 2014 / 4:09 PM / 4 years ago

Brazil minister quits, urges Rousseff to 'restore confidence'

SAO PAULO (Reuters) - A Brazilian minister resigned on Tuesday and urged leftist President Dilma Rousseff to appoint an “independent” new economic team to “restore confidence and credibility” among investors, in an unusual public critique from an ally.

Brazil's Senator-elect Marta Suplicy poses after an interview with Reuters in Sao Paulo December 16, 2010. REUTERS/Nacho Doce

Culture Minister Marta Suplicy, a former mayor of Sao Paulo and a senior figure in the ruling Workers’ Party, had been expected to leave government as Rousseff sets up a new Cabinet following her narrow re-election victory on Oct. 26.

But her resignation letter contained unexpected advice on the biggest policy question facing Rousseff - who will succeed current finance minister Guido Mantega in her second term.

Many investors blame Mantega and Rousseff, herself a trained economist who relishes making financial policy decisions, for interventionist policies that have caused the economy to grow less than 2 percent a year since she took office in 2011.

Some within the Workers’ Party have pushed for Rousseff to appoint a more centrist figure, such as former BankBoston executive and central bank president Henrique Meirelles, to replace Mantega and recover the investor confidence that helped make Brazil’s economy boom last decade.

Suplicy urged Rousseff to “choose ... an independent economic team, experienced and proven, that will recover the confidence and credibility of your government, and that is, above all, committed to a new agenda of stability and growth for our country.”

The letter was posted on Suplicy’s Facebook page at a time when Rousseff was outside of Brazil, en route to a summit in Australia.

Some on the left wing of Rousseff’s party warn against appointing a finance minister who would make big budget cuts or other overtures to financial markets, fearing they could cause unemployment to rise from current lows of about 5 percent.

They prefer that Rousseff appoint someone similar to Mantega who will maintain a strong state hand in the economy.

Editing by Todd Benson and Matthew Lewis

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