The political vacuum that would open up if Dilma Rousseff were voted out of power is most likely to be filled by Michel Temer, the current vice president, who would emerge as the big winner from the impeachment crisis.
The 75 year old conservative politician from the centrist PMDB party has taken a number of liberal economic positions that would likely lead to cutting the size of the state if enacted.
But before he can put his policy ideas into action Temer will also have to rebuff corruption allegations that have been made against him, as well as several other members of the political establishment.
A Supreme Court judge this week suggested that Temer should also be submitted to an impeachment procedure. But that seems to be a distant prospect and markets are likely to welcome the stability and relief that a Temer-led administration would bring.
“If [Rousseff’s] impeachment is approved by a comfortable majority, investors will react positively,” said Paulo Sotero, director of the Brazil Institute in Washington.
“If Temer has the political strength, the government may approve a few reforms and show that there is a real difference in contrast with the Rousseff administration, which has been paralysed for a while. It may look promising from that angle. But the markets will not sign a blank cheque.”
He said that the market would want to see genuine efforts made to strengthen competitiveness and measures to integrate Brazil in the global value chain.
“Failing that, if Temer cannot take advantage of this situation to take some concrete steps, this optimism will rapidly disappear until the economy actually starts to improve,” he said.
His first steps are likely to take short term measures that would boost his own popularity, such as cutting the number of ministries (they are currently 32), said a local banker.
His popularity would then help implement some more reforms to cut the state, in line with the liberal economic programme issued by the PMDB and known as “A Bridge to the Future”.
According to the constitution, if impeachment is voted through by the end of the year, Temer would take up the presidency until the end of 2017, when a new presidential election is due to be held.
Meanwhile, some executives have expressed doubts over what will happen after the current impeachment process is completed.
“Some may go, and some may come in,” said a CEO of a multinational industrial company in Brazil. “It all depends on who gets in and how it plays out. If you ask me, do you have to push someone out?
“I would rather say, what is needed is a project that would mobilise people. So it depends less on those that may leave office, than especially on those that may come in.”