Brazil’s current government and its largest contractor are trying to survive the latest episode in the country’s long-running construction bribery scandal. Market participants and observers are speculating on the future of Dilma Roussef’s government and contractor Odebrecht S.A. in the wake of a 19-year prison sentence a Brazilian judge gave the contractor’s former CEO Marcelo Odebrecht. The charges are linked to corruption and money-laundering charges in gaining work from Brazilian state-owned oil firm Petrobras.
Odebrecht and four other company executives left the firm last year after being arrested in the Lava Jato corruption probe. The executive, descendant of the company’s founder, has not said whether he will appeal the sentence or make a deal with prosecutors to reduce it. Raphael Figueredo, an analyst at São Paulo brokerage Clear Corretora, told Reuters that market watchers have been “paying close attention to every development of this investigation.”