Economist.com Cities Guide: Sao Paulo Briefing - July 2006

News this month

Out on a wing

A controversial deal to sell the cargo business of Varig, Brazil’s flagship airline, may help save the troubled carrier. The $20m injection should keep Varig flying while buyers are found for the rest of the airline, which has debts of over $3.4 billion. Reportedly under government pressure, the civil aviation authority approved the sale of VarigLog to Volo, a consortium linked to Matlin Patterson, an American fund manager. Under Brazilian law foreign investors cannot own more than 20% of an airline, and doubt has been cast on the origin of Volo’s money. The civil aviation authority said 80% of the financing had Brazilian guarantees, though few details of the deal have been made public. On June 23rd, a $449m bid for the whole airline by a consortium that included Varig employees was annulled when the group failed to make a $75m down-payment.

Widespread flight cancellations and the threat of aircraft being repossessed and fuel supplies cut off still make bankruptcy a probable outcome. That would put 10,000 people out of work, and leave 26,000 Brazilians stranded overseas, many of them in Germany for the World Cup.

Organised crime

Violence erupted in the São Paulo State prison system again, only one month after the state’s largest criminal gang, the Primeiro Comando da Capital (PCC), had co-ordinated widespread and deadly attacks against the government using mobile phones. On June 16th riots in eight prisons, organised by the PCC, left one inmate dead and others—plus some guards—wounded. Prisoners were protesting against shortened break periods and overcrowding.

Figures released in June showed how the May riots sparked a statewide killing spree. On June 13th the Conselho Regional de Medicina do Estado, which regulates medical practice in the state and reviewed the autopsy reports, said that 492 people in São Paulo State died from gunshot wounds between May 12th and 20th—a number three times higher than average, while fewer than 150 deaths were linked directly to the PCC incidents. Reports from 23 autopsy laboratories also showed that of the 126 people allegedly killed by police, one in five had been shot in the head, indicating execution-style killings. This news prompted demands for the resignation of Saulo de Castro Abreu Filho, the state security secretary.

Shutting up shop?

Daslu, one of São Paulo’s fanciest department stores, hit the news again in June when Carlos Piva de Albuquerque, the owner's brother, was arrested for the second time in 12 months on charges of tax fraud. Mr Albuquerque, the store’s finance director, spent ten days in prison before his lawyers secured his release.

Back in July 2005 Mr Albuquerque and his sister, Eliana Tranchesi (who owns Daslu), were briefly detained after a police raid on Daslu's new premises. They were accused of under-reporting revenues and the value of imported goods in order to avoid taxes—charges, denied by Ms Tranchesi, that carry sentences of up to 21 years. The public prosecutor, Matheus Baraldi Magnani, is still building a case and no date has been set for a trial.

After the rearrest of Mr Albuquerque, Ms Tranchesi claimed that Mr Magnani was persecuting her store. He said the company was continuing to import luxury goods illegally.

Healing eyesores

São Paulo is not pretty, but Mayor Gilberto Kassab has a plan to improve things. On June 8th he proposed ambitious laws under the banner “Cidade Limpa” (Clean City) to rid the streets of advertising posters. “It’s zero tolerance for visual pollution,” he explained. Laws to regulate outdoor advertising already exist but, according to Fenapex, the National Federation of Outdoor Advertisers, the city has only 700 inspectors to regulate 1.4m displays. Of the estimated 15,000 huge posters in São Paulo, Fenaplex reckons that just one-third are legal.

To make policing easier, Mr Kassab wants to ban all posters larger than four metres squared and license one company to install advertising in approved areas, such as bus stops. Yet Fenapex believes the law, if passed, will jeopardise 15,000 jobs. For those stuck in traffic, the huge advertisements, many of which feature attractive models, are more interesting than the buildings they cover.

Yellow (and green) fever

On June 13th Brazil paused. The day the country had been anticipating for four years finally dawned as the national football team played its opening game in the “rumo ao hexa” (“the road to the sixth”), as the five-time champions’ World Cup campaign is known. Shops, offices, banks and schools closed early and 174km of traffic jams paralysed São Paulo before the 4pm kick-off, as Paulistanos rushed to watch a lacklustre 1-0 win over Croatia. The police, however, will have to stay focused on their work: in the run-up to the World Cup 18 large-screen TVs were stolen from bars and restaurants across the city.

Catch if you can

July 2006

Degas – The Artist’s Universe

Until August 20th 2006

With 196 works on display, this exhibit provides a comprehensive look at the art of Edgar Degas, a French Impressionist. The show’s scope is a rarity in Latin America. There are 110 works from the Museu de Arte de São Paulo; the rest hail from museums such as New York’s Museum of Modern Art, London’s National Gallery and the Musée Picasso in Paris.

The exhibition is divided into three sections: the first explores the artist’s more classical work, portraits and the so-called “Grammar of Movement”, which includes Degas’s famous paintings of horses, dancers, laundresses and prostitutes. The exhibit also features work by artists who influenced Degas or were influenced by him, such as Titian, Velásquez, Ingres, Picasso and Toulouse-Lautrec.

Museu de Arte de São Paulo, Avenida Paulista 1578, Jardim Paulista. Tel: +55 0(11) 3251-5644. Open: Tues-Sun 11am-6pm. Entrance 15 reais; free on Tues. See the museum’s website.

More from the Sao Paulo cultural calendar