Dilma Rousseff, the president-elect, as announced by her press office, has chosen economist Alexandre Tombini to be the next president of the central bank. Economist Guido Mantega will continue as Finance minister and engineer Miriam Belchoir coordinator of PAC (program to bolster growth) will become Planning and Budget minister.
Tombini, currently head of central bank regulations, must be confirmed by the Brazilian Senate before he takes office.
“The president-elect established that the new team ensures a continuity of the successful economic policy of President Lula’s government – based on inflationary targets, fluctuating foreign exchange rate and fiscal responsibility – and promotes advances that will lead Brazil to defeat poverty and reach the goal of a fully developed nation,” added the official release.
The name of the next central bank president will certainly attract the most attention given the international and domestic relevance and prestige that the current president Henrique Meirelles has achieved for the institution in his eight years at the helm successfully combating inflation and laying the ground for Brazil’s current sustained growth.
However economist Tombini is not a stranger in banking circles. He has held relevant posts under the administrations of presidents Itamar Franco, Fernando Cardoso and Lula da Silva.
Furthermore Meirelles whenever travelling overseas would leave Tombini as interim president of the bank.
“Tombini is a cadre of the best quality, a man ready for the challenge to keep the central bank operating on technical logics and abiding the mandate to offer the Brazilians a good quality currency,” said Gustavo Franco, a former central bank president (1997/1999).
Another central banker Arminio Fraga (1999/2003) describes Tombini as “an excellent and complete professional: he has an academic background and experience in several areas of public service, and more than proven competence in difficult assignments at difficult moments.”
“Discreet, diplomatic, courteous but at the same time a very hard negotiator” is how a fellow economist describes the new president of Brazil’s central bank. Besides “he is very cautious regarding the media.”
Born in Porto Alegre 46 years ago, Tombini belongs to the central bank staff since 1995 following experiences at the Finance ministry and the cabinet office.
Since then he was actively involved in the stabilization and new currency program known as Plan Real, the elaboration of an inflation targets system and the regulation of Brazil’s financial system, following the 1998/1999 crisis.
He also participated in the drafting of the Mercosur common external tariff system together with delegates from Argentina, Uruguay and Paraguay.
Tombini is a graduate from the University of Brasilia and a PhD from Illinois University. He was a professor at Brasilia University until 1995 and a member of Brazil’s representation before the IMF in Washington.
As to his position, although all members of the Brazilian central bank Monetary Policy Committee (Copom) are described as “orthodox” in line with Meirelles thinking, there are two variants: those less tolerant with inflation (who support an immediate increase in rates) or those more tolerant (who support a increase in interest rates when there is a clear, evident certainty of inflationary pressures).
Allegedly according to private bankers’ claims, Tombini belongs to the second group, and is more in line with president-elect Rousseff announcement that she would like lower interest rates.