On 30 October, former President Luiz Inacio Lula da Silva defeated incumbent Jair Bolsonaro to win an unprecedented third presidential term. The Supreme Electoral Tribunal (TSE) declared Lula the winner in the bitterly fought second round with 50.9% of the vote; Bolsonaro garnered 49.1%. Lula relied on his overwhelming support in the northeast region and slight advantage in the pivotal state of Minas Gerais. Bolsonaro won in the center-west, north, south and southeast regions, but his vote totals fell short of countering Lula’s dominance in the northeast. One percent (2,139,645 votes) separated the candidates, the slimmest margin since the enactment of the 1988 constitution. The stage is now set for a troubling transition before the inauguration on 1 January 2023. 

After being declared the victor, Lula spoke to thousands of supporters gathered on the Avenida Paulista in Sao Paulo. He pledged to restore the constitutional order, strengthen democracy and govern for all Brazilians regardless of their partisan loyalties. Reaffirming that his first priority will be addressing the country’s deepening hunger and poverty, he noted that he will also work to accelerate the energy transition and take every measure to end illegal deforestation in the Amazon. He thanked his allies, including Vice President-elect Geraldo Alckmin, who joked that his wife had worked harder for Lula than in his own campaigns.  

US President Joe Biden and French President Emmanuel Macron, among other world leaders, publicly recognized the results and congratulated Lula. Additionally, Chamber of Deputies President Arthur Lira – a staunch Bolsonaro ally – and Senate President Rodrigo Pacheco quickly recognized the TSE’s declaration and pledged to uphold the constitutional order. 

Bolsonaro pulled out all stops to win re-election and outperformed last week’s public opinion polling, but he fell short in the end after a rocky four-year tenure. Earlier this year, the president replaced the CEO of Petrobras several times in an effort to tamp down fuel prices. In August, the government expanded temporary cash assistance for the poor, taxi drivers and truckers. His administration authorized private banks to extend “payday” loans to recipients of the cash transfer program while the president flaunted violations of electoral law by using government installations and resources to promote his campaign. 


  • On 30 October, the Supreme Electoral Tribunal (TSE) declared former President Luiz Inacio Lula da Silva the winner of the presidential election by a narrow margin against incumbent President Jair Bolsonaro.
  • Lula, vice presidential running mate Geraldo Alckmin and their supporters celebrated the victory in Sao Paulo, where the president- elect pledged to combat hunger and poverty while strengthening democratic rule.
  • Although several of Bolsonaro’s key allies – including Chamber of Deputies President Arthur Lira – publicly recognized Lula’s victory, the president did not make a concession speech, casting uncertainty over the transition to the next administration.

On election day, Bolsonaro watched as the Federal Highway Police (PRF), accompanied by army units in several jurisdictions, carried out an unprecedented “blitz,” setting up checkpoints to slow traffic and discourage voters from making their way to the polls in Lula strongholds. The PRF’s “Election Operation” was in direct contravention of a TSE order to suspend such operations during balloting, revealing the administration’s willingness to actively suppress voter turnout in order to gain an advantage. 

Following the TSE’s announcement, Bolsonaro retreated to his presidential residence and failed to make a concession speech. The following morning, on 31 October, truckers obstructed major highways throughout the country to protest the results while news spread that Bolsonaro’s wife, Michele, had become estranged from her husband. We expect disruptions to the transition process and more revelations about the Bolsonaro family and inner circle in the coming weeks, but we do not believe that there will be a significant rupture of the constitutional order ahead of the inauguration. 

In our view, Lula’s narrow victory poses several key implications for the transition: 

  • Rocky road ahead. Lula’s camp expects the Bolsonaro administration to obstruct the transition process, preventing access to critical budgetary and economic policy information. The Supreme Court will try to mediate, preventing the current administration from taking any drastic measures that would be prejudicial to the incoming administration. Meanwhile, Bolsonaro followers will protest the TSE and the Supreme Court, hoping to disrupt the transition process. 
  • Bolsonaro’s congressional allies abandoning him. Lira has already signaled that he is ready to dialogue with Lula. We expect the president of Bolsonaro’s Liberal Party (PL), Valdemar Costa Neto, to engage the president-elect in the coming days. Together, Lula, Alckmin, Lira and Costa Neto will likely shape the legislative agenda for the first 100 days of the next administration, testing whether Bolsonaro loyalists in Congress are willing to work with Lula or obstruct the incoming administration. 
  • Greater role for Lula’s centrist allies. Lula owes his victory to the avid support of former adversaries, including Alckmin and former presidential candidate and Senator Simone Tebet (see our Personality of the Week). We expect Lula to carry out a co-optation strategy against Bolsonaro allies in Congress, but the effort will require close political collaboration with Alckmin, Tebet and other independent center-right forces. The president-elect values his centrist political partners and will feature them during the first year of his administration. 

The transition process will be troublesome in the short term and could delay important policy and regulatory decisions with significant investor implications. Lula’s camp will take legal action to stop any measures which infringe on forest and indigenous community reserves, especially in the agriculture and mining sectors. Moreover, it is possible that Lula’s transition team could take legal measures to suspend the National Petroleum Agency (ANP)’s open acreage tender of pre-salt blocks, which is slated to begin on 16 December. Horizon will closely monitor the transition process over the next two months and report disruptions as well as any legal actions that pose implications for investors and the business climate. 

personality of the week

Simone Tebet

Senator and former presidential candidate Tebet, 52, is a rising star in Brazilian politics from the state of Mato Grosso do Sul. She achieved an impressive third-place finish in the first round of the 2022 presidential election before throwing her support behind Lula in the runoff, despite her state’s overwhelming support for Bolsonaro. Her choice appears to have paid off, as Lula’s inner circle discusses her possible ministerial appointment. 

She received a bachelor’s degree in law from the Federal University of Rio de Janeiro (UFRJ) and a master’s degree in law from the Pontifical Catholic University of Sao Paulo. She began her career as a law professor at the Dom Bosco Catholic University, Anhanguera- Uniderp University and the Federal University of Mato Grosso do Sul. 

Her father, Ramez Tebet, is a well-known politician from Mato Grosso do Sul who served as governor, senator, Senate president and minister of national integration under the administration of former President Fernando Henrique Cardoso. Her father’s family is Lebanese-Brazilian. Following Ramez’s footsteps, Tebet was elected as a state deputy in 2002. In 2004, she was elected mayor of Tres Lagoas before winning election as vice governor in 2010. In 2014, she was elected senator. She distinguished herself through her critical participation in the COVID-19 congressional inquiry committee (CPI) in 2021, before launching her presidential bid in 2022. 

Tebet is married to Eduardo Rocha, a state deputy. They have two daughters, Maria Eduarda and Maria Fernanda. 

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