Brazil's Lula convicted of corruption

Brazil's former president Luiz Inácio Lula da Silva was sentenced to nine years, six months in prison for his role in a corruption and money laundering scheme, all but thwarting his chances of running in the next presidential election.

The sentence was meted out by hard-line lower court judge Sergio Moro in relation to the acquisition of a beachfront apartment by Lula. His lawyer denied that the former president is the owner of the apartment, but the judge alleged that the property represented a bribery payment to Lula from construction company OAS.

Under the sentencing, Lula's arrest may only take place after a ruling is issued by a court of appeal, a spokesperson for Moro's office told BNamericas. A timetable for an appeal was not provided.

"That is almost a fatal shot to the [political] left. I believe that in the next seven or eight months, Lula will face a defeat in the appeal court and will see the end of his dream to be president once again," David Fleischer, emeritus professor of political science at the Universidade de Brasília, told BNamericas.

The ruling is a major setback for Lula's hopes to return to power in next year's general election. The charismatic leftist leader ruled the country from 2003 to 2011 and is the early frontrunner for the October 2018 elections, with 30% of the intended vote, according to the most recent poll by Datafolha, the polling institute of daily Folha de S. Paulo. It is also likely to be the first in a series of blows to be suffered, as he still faces four other trials, all linked with the sprawling Lava Jato anticorruption probe.

The supreme court is assessing existing electoral laws to determine whether a guilty verdict in a lower court is sufficient to block a politician's candidacy.

Nevertheless, the verdict is considered by analysts to be the end of Lula's plan to run in the next election, opening up room for center-right forces and weakening the left.

"This afternoon's ruling by judge Sergio Moro to convict former president Lula on corruption charges all but rules him out of the running for next year's presidential election, and is likely to give a near-term boost to Brazilian markets," said Neil Shearing, an economist at Capital Economics.

(BNamericas covers Latin America's politics and economy in its banking sector. This story has been opened to all subscribers.)