World Cup Puts Spotlight on Domestic Challenges for Brazil

In the coming months, Brazil will host the World Cup and hold elections across all levels of government—all while its once-strong economy shows growing signs of a slowdown, hobbled by the country’s suffocating public sector, trade protection and inflation. 

Brazil’s GDP shrank in the third quarter of last year, its first contraction since 2009. The current outlook is a far cry from the exhilarating days of 2006-2007 when then-President Luiz Inacio Lula da Silva, in office 2003-2011, oversaw a massive oil discovery in the Tupi field off Brazil’s southeastern coast and successfully wooed FIFA, international soccer’s governing federation, for World Cup hosting rights.

Those accomplishments heralded the arrival of a new Brazil, and the brighter international spotlight that resulted will put Dilma Rousseff, Brazil’s president since January 2011 and Silva’s hand-picked successor, to the test this year.

Although soccer-obsessed Brazilians applauded when the country was named the host of the 2014 World Cup, the reality of the task soon hit home. For one, the countrywide mega-event, expected to attract more than 600,000 foreign spectators, has required a massive infrastructural upgrade. Initially, the Brazilian government was slow to respond, first granting private concessions over its major airports—historically run by the air force—and only later fully privatizing them after works failed to meet expectations. 

Other infrastructural needs abound: stadiums built or renovated to FIFA’s strict standards, hotel rooms to accommodate visitors and better roads between cities. FIFA’s leadership has been vocally critical of Brazil’s preparations. The federation’s president, Sepp Blatter, this month publicly lamented that never before had a World Cup host country been this far behind so close to kickoff....

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