Brazil’s President Moving Swiftly to Stimulate, Transform Country : Latin America: Bold steps of the last six months are stirring excitement--and uncertainty.

President Fernando Collor de Mello, 41, likes to drive fast cars and motorcycles. He has even taken the controls of a supersonic jet fighter on one of his much publicized weekend outings. And during the week in his Planalto Palace office, Collor is also a man in a hurry.

He has ordered a bold series of measures during his first six months in office that are rapidly changing the government and economy of this country. As Brazil absorbs the changes, brisk cross-currents of excitement and uncertainty are sweeping the nation of 150 million people.

Collor’s critics call him rash and authoritarian. But with his forceful personality and his public relations skills, he has kept the hopes of most Brazilians high so far, opinion polls indicate.

He has also wasted no time in his efforts to win overseas support. On a whirlwind tour before taking office, he met with President Bush, Japanese, Soviet and European leaders, and he is scheduled to meet again with Bush in Washington on Sunday.

While it is too early to assess the ultimate success of his leadership, Collor is clearly in the driver’s seat as Latin America’s largest nation speeds toward a future that, for better or worse, will bear his indelible mark.

So far, the ride has not been smooth.

As a result of Collor’s tough anti-inflation measures, the economy is in a slump that government officials refuse to call a recession even though it has all of the earmarks of one. Meanwhile, prices continue to rise at discouraging monthly rates of more than 10%.

Collor acknowledges that the tough part is not over.

But the difficulties are part of the process of change, he insists. What matters most, he tells Brazilians, is that his administration is stripping down and reforming a bloated and sluggish government, overhauling an outdated industrial sector, opening up the overprotected national economy to the stimulus of the global market, and preparing Brazil to move up as quickly as possible from Third-World underdevelopment to First-World economic prowess.

Collor is part of a pattern across Latin America and elsewhere around the world: From Mexico City to Moscow, national leaders are putting new emphasis on private enterprise, free trade and lean government in the universal quest for economic progress. But in few Western countries has the transformation begun faster than in Brazil under Collor.

That is partly because of strong, pent-up popular demand for change after 21 years of military government and a five-year transitional period before Collor took office March 15. An economic crisis, including inflation of 84% in the month before his inauguration, added to the urgency. And his own impatient, action-oriented style has kept things clipping along since then.

“President Collor runs his government as if he were an executive of a multinational corporation,” commented the newspaper O Estado de Sao Paulo. “He likes to make decisions instantly, he is always calling in promises, and he is convinced that time is money--rarely do conferences surpass the limit of 15 minutes.”

Critics label Collor’s fondness for recreational speed as exhibitionism, but many analysts see it as part of the president’s deft public relations efforts to project an energetic, macho image that will help maintain popular support for him and his often painful reforms.

In a survey published early this month by Ibope, Brazil’s top polling firm, 60% of those interviewed said they trusted the president, and 79% said he was doing a fair, good or excellent job.

David Fleischer, an American-born political science professor at University of Brasilia, is critical of Collor but gives him high marks in public relations.

“He’s doing very well in terms of publicity and rhetoric,” Fleischer said. “Good communications and marketing skills got him elected.”

Collor’s election victory last December capped a phenomenally successful media campaign that began when he was the obscure governor of a small, poor state in northeastern Brazil. As a presidential hopeful, he drew increasing public attention by lambasting corrupt politicians, overpaid and lazy bureaucrats, and cozy businessmen who depend on official favors.

But in Fleischer’s view, Collor is part of the “old system,” interested only in changes that favor the established social and political order and supported in Congress by “exactly the same group that he berated so much during his campaign last year.”

Before he became president, many people were skeptical of Collor’s will to make changes that would favor Brazil’s poor majority and disturb the dominant elite by altering the status quo. A foreign banker who was one of the skeptics now says:

“I’m a convert. I think Collor really does want to change things. I think he really does represent a new wind in this country.”

The banker said Collor’s actions have proven his determination to break venal relationships between big business and government and to demand efficiency in public administration.

Alexandre Barros, a political scientist who works as a consultant to private investors, said opinions about Collor in the Brazilian business community have swung radically since mid-March, when the new president froze most deposits in the financial market and warned high-profit monopolies and oligopolies that their free ride was ending.

“At first there was total perplexity,” Barros said. Then, when inflation rapidly subsided and business picked up, there was lot of optimism based on “wishful thinking,” he said. “I think that now people have a more balanced view.”

For example, Collor’s industrial policy, which includes a phased reduction of import barriers, pleases many businessmen but worries others looking for protection from foreign competition.

“I am optimistic in the middle term, because I think Collor’s policies are going in the right direction,” Barros said. But in the long run, he predicted, underlying problems such as deficient educational and health care systems for the Brazilian masses will retard development.

Some analysts are less optimistic about Collor’s prospects for getting inflation under control, a step considered essential for healthy economic growth.

Collor and his economic advisers blame the persistence of the inflation on a society that accepts rapid price increases as normal and on businessmen who fail to cut costs and refuse to reduce profits.

“Inflation has not gone down because we still have some reticence on the part of certain businesses to assimilate the changes,” said Joao Cunha, undersecretary of economy. But Cunha predicted in an interview that the government policy of tightly restricting the money supply eventually will force businesses to hold down prices.

“We are certain that by the end of the year we will have inflation well below the level of 10% a month,” he said.

The monetary policy has dampened economic activity, while inflation is eating away at real wages. Most independent economists are calling the slump a recession.

“I would not say we are in a recession,” Cunha said. “I would say we are entering a phase of reduced activity.”

The degree of reduction will depend on the cooperation of business, unions and consumers, he said.

The official goal is to stabilize inflation at 2% to 3% a month by the end of the year. “If we achieve stabilization, after the first quarter (of next year) I feel we can start thinking about growth again,” Cunha said.

Meantime, workers are clamoring for raises in their eroded salaries. The press has reported more than 500 strikes since March. A power strike put out the lights in Brasilia for 10 hours, even darkening Collor’s residence.

Collor’s reforms began the day he took office, when he reduced the number of government ministries from 24 to 12, and since then he has kept up an almost-steady barrage of measures. Among them:

Ministries have dismissed, retired or furloughed more than 250,000 of the government’s 1.6 million workers.

Collor has ordered the sale of 42 luxury homes, formerly provided as perquisites to ministers and other senior officials, as well as 20,000 apartments for bureaucrats, 4,500 cars and five airplanes.

Plans have been made to auction off scores of government-run corporations. The first sales have been delayed until early next year, but a recent presidential decree ordered government-run companies to reduce spending by 25% across the board.

The president has reduced military spending from 6% of the national budget to 2.2%.

Collor’s Economy Ministry has begun eliminating import restrictions and lowering customs duties so that foreign goods may compete on the Brazilian market, helping to keep prices competitive, and imported machinery and components can be used to improve the quality of Brazilian products.

A new government program will provide $3 billion in financing for development in science and technology over four years to make Brazilian industry more competitive internationally.

The economic team has reached a preliminary agreement with the International Monetary Fund that foresees $2 billion in stand-by credits for Brazil. The IMF agreement is regarded as a preliminary step for renegotiating Brazil’s $117-billion foreign debt, which has not been serviced for more than a year.

In its letter to the IMF, the government says it will have a surplus in its budget this year, wiping out the deficit Collor inherited in March.

A literacy program will invest $600 million this year and next in teaching 25 million illiterate Brazilians to read and write.