Brazil’s finance minister Fernando Haddad resigned to run for governor of São Paulo state, according to a decision published in Brazil’s official gazette Friday, the Associated Press reported. Haddad made the bid public during an event in São Bernardo do Campo, in São Paulo state, where he said he was seeking office without bargaining.
Haddad told attendees Thursday, “I don’t run in elections to bargain, I run to win,” adding that “Political victory is always possible: you just have to present yourself with integrity and a strong plan.” The AP reported that the decision to step aside as finance minister was signed by President Luiz Inácio Lula da Silva.
In the same gazette decision, Lula named Dario Durigan to replace Haddad as finance minister. Durigan previously served as executive-secretary of the finance ministry, according to the AP report.
The São Paulo race pits Haddad against current Gov. Tarcísio de Freitas, an ally of former President Jair Bolsonaro, whose plans for reelection would set up a contest between the Lula-aligned Workers’ Party and de Freitas. The AP reported that de Freitas has said he will seek another term in the state.
Paulo Henrique Cassimiro, a politics professor at Rio de Janeiro State University, said Haddad is unlikely to win based on the polls but that running for governor could still give him more prominence on the national stage. Cassimiro said Lula’s Workers’ Party “is really counting on him, including for Lula’s succession,” and added that, even if Haddad loses, the campaign can create political capital and broaden the candidate’s name recognition.
Cassimiro also said that in the event of a Lula victory—after Lula announced his bid for reelection last October—Haddad could return to the finance ministry. The AP reported that Lula and Flávio Bolsonaro, Bolsonaro’s eldest son who has also said he will run for president, are neck and neck in hypothetical run-off polls between the pair.
During the São Paulo event Thursday, Lula described the national political situation as “very grave.” He said, “If we don’t bring forward the best people we have in each city and each state, and if we don’t take up the fight to defend democracy, we run the risk, through inaction, of handing democracy back once again to the fascists,” according to the AP report.
Haddad previously ran for president in 2018 after Bolsonaro’s rise, when Lula was in prison. Lula spent 19 months behind bars before the Supreme Court later annulled his convictions, allowing Lula to run against Bolsonaro in 2022, where he won, the AP reported. The AP also said Bolsonaro is serving a 27-year prison sentence for attempting a coup despite that electoral defeat.
The AP report described Haddad’s role at the finance ministry as including “huge changes” in how Brazil taxes goods and services, alongside a popular income tax reform. The AP also noted that the minister’s tenure was not always smooth, citing that in 2024 internet users created “memes nicknaming Haddad ‘Taxad’—a pun combining tax and his surname—after a tariff on cheap international online shopping generated controversy.”
With Durigan taking over, economist Carla Beni said one of the challenges will be handling the effect of the Iran war on Brazil’s economy. Beni, an economist at the Getulio Vargas Foundation, said, “A very intense war like the one we’re seeing in the Middle East is something quite complex for Durigan to manage,” according to the AP report.
The AP reported that last week Lula’s government announced temporary federal tax relief on diesel amid rising energy prices worldwide. The report said the government planned to compensate the financial loss for public accounts with a 12% tax on crude exports.