page_title: Fernando Collor de Mello
section_title: Free trade, privatization and state reforms
hierarchical_section_title: Fernando Collor de Mello / Presidency (1990-1992) / Free trade, privatization and state reforms
caption_attribution_description: Português: Fernando Collor, presidente do Brasil (1990-1992), no Palácio do Planalto.
context_page_description: Fernando Affonso Collor de Mello is a Brazilian politician who served as the 32nd President of Brazil from 1990 to 1992, when he resigned in a failed attempt to stop his impeachment trial by the Brazilian Senate. Collor was the first President democratically elected after the end of the Brazilian military government. He became the youngest president in Brazilian history, taking office at the age of 40. After he resigned from the presidency, the impeachment trial on charges of corruption continued. Collor was found guilty by the Senate and disqualified from holding elected office for eight years. He was later acquitted of ordinary criminal charges in his judicial trial before Brazil's Supreme Federal Court, for lack of valid evidence.
  Fernando Collor was born into a political family. He is the son of the former Senator Arnon Affonso de Farias Mello and Leda Collor
context_section_description: Under Zélia's tenure as Brazil's Minister of Finances, the country had a period of major changes, featuring what ISTOÉ magazine called an "unprecedented revolution" in many levels of public administration: "privatization, opening its market to free trade, encouraging industrial modernization, temporary control of the hyper-inflation and public debt reduction."
  In the month before Collor took power, hyperinflation was at 90 percent per month and climbing. All accounts over 50,000 cruzeiros (about US$500 at that time), were frozen for several weeks. He also proposed freezes in wages and prices, as well as major cuts in government spending. The measures were received unenthusiastically by the people, though many felt that radical measures were necessary to kill the hyperinflation. Within a few months, however, inflation resumed, eventually reaching rates of 10 percent a month.
  During the course of his government, Collor was accused of condoning an influence peddling scheme. The accusations weighed on the government and led Collor and his team to an institutional crisis leading to a loss of credibility that reached the finance minister, Zélia.
  This political crisis had negative consequences on his ability to carry out his policies and reforms. The Plano Collor I, under Zélia would be renewed with the implementation of the Plano Collor II; the government's loss of prestige would make that follow-up plan short-lived and largely ineffective. The failure of Zélia and Plano Collor I led to their substitution by Marcílio Marques Moreira and his Plano Collor II. Moreira's plan tried to correct some aspects of the first plan, but it was too late. Collor's administration was paralyzed by the fast deterioration of his image, through a succession of corruption accusations.
  During the Plano Collor, yearly inflation was at first reduced from 30,000 percent in 1990 (Collor's first year in government) to 400 percent in 1991, but then climbed back up to 1,020 percent in 1992 (when he left office). Inflation continued to rise to 2,294 percent in 1994 (two years after he left office).
  Although Zélia acknowledged later that the Plano Collor didn't end inflation, she also stated: "It is also possible to see with clarity that, under very difficult conditions, we promoted the balancing of the national debt – and that, together with the commercial opening, it created the basis for the implementation of the Plano Real."
  Parts of Collor's free trade and privatization program were followed by his successors: Itamar Franco (Collor's running mate), Fernando Henrique Cardoso (a member of the Franco cabinet) and Lula da Silva. Collor's administration privatized 15 different companies (including Acesita), and began the process of privatizing several others, such as Embraer, Telebrás and Companhia Vale do Rio Doce. Some members of Collor's government were also part of the later Cardoso administration in different or similar functions: 
  Pedro Malan
  Renan Calheiros (PMDB-AL)
  Antônio Kandir (PSDB-SP)
  Pratini de Moraes
  Celso Lafer
  Reinhold Stephanes
  Armínio Fraga
  Pedro Parente
  Luiz Carlos Bresser-Pereira, a minister in the previous Sarney and the following Fernando Henrique Cardoso administrations, stated that "Collor changed the political agenda in the country, because he implemented brave and very necessary reforms, and he pursued fiscal adjustments. Although other attempts had been made since 1987, it was during Collor's administration that old statist ideas were confronted and combated (...) by a brave agenda of economic reforms geared towards free trade and privatization."
  According to Philippe Faucher, professor of political science at McGill University, the combination of the political crisis and the hyperinflation continued to reduce Collor's credibility and in that political vacuum an impeachment process took place, precipitated by Pedro Collor's (Fernando Collor's brother) accusations and other social and political sectors which thought they would be harmed by his policies.
caption: President Collor speaking at the Planalto presidential palace, 1991.
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