BRAZIL: President Luiz Inacio Lula da Silva of Brazil has announced reform measures designed to combat poverty and racism, beginning with an ambitious agrarian reform campaign, writes Michael McCaughan.
Mr da Silva formally handed over 200,000 hectares of expropriated agricultural land to 5,000 landless farmers and declared war on "digital exclusion", pledging to instal 4,000 computers in post offices around the country. Poor Brazilians will have the right to an e-mail address and 10 minutes free Internet time each day.
In addition Lula announced the creation of a new ministry next week, coinciding with World Anti-Racism day, charged with implementing affirmative measures in a nation sharply divided along racial lines.
Mr da Silva, elected last October, won 51 million votes from an electorate disenchanted with the government of president Fernando Henrique Cardoso, which ended inflation but failed to reduce poverty levels.
After a month in office Mr da Silva has silenced his traditional critics in the business sector, yet faces harsh criticism from within his own Workers' Party (PT).
The muted rebellion came as he announced a US$4 billion reduction in this year's budget due to apparent inaccuracies in the estimates drawn up by the previous administration. The budget cuts were greeted with disapproval by several PT deputies, who claimed their leader paid more attention to fiscal rectitude than social reform.
"There are no cutbacks in social spending," Lula countered. "Any cutbacks are due to poor projections by the past government."
Members of the PT also expressed dismay at the election of conservative former president Jose Sarney as senate president in exchange for his support.
The new president demanded that his party unite behind him, arguing that a tough budget now will stabilise the economy sufficiently to be able to carry out ambitious social programmes later.
Lula appointed fiscal conservatives to his economic team, while left-wing loyalists occupy labour and social welfare ministries. The criticism from within his own party highlights the fragility of a broad coalition.
"Lula is walking a tightrope between fiscal rectitude and radical reforms," said political analyst Joao Silva, pointing to the inherent contradictions in pleasing conservative financial investors and long-time PT supporters anxious for radical change.
In neighbouring Venezuela, President Hugo Chavez has spent the past three years battling a business lobby determined to prevent radical social reforms.
Mr da Silva scored a remarkable victory on the campaign trail last year, securing the endorsement of 500 business leaders who demanded "an agenda to increase competitiveness" in return for their support.
Such backing was vital for Lula's election effort as Brazil's currency lost more than one-third of its value and foreign investors put a brake on spending.
Brazil has one of the world's worst income disparities: 20 per cent of the population enjoy first-world living conditions, while 50 per cent subsist in conditions similar to sub-Saharan Africa.