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New Brazil finance minister to tackle pension, labor reform
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BRASILIA, Brazil (AP) — Brazil's new finance minister said Friday that he'll tackle pension reform and labor law reform, signaling potentially sensitive changes for a sputtering economy a day after President Dilma Rousseff was suspended.

Henrique Meirelles is the key member of the Cabinet assembled by interim President Michel Temer, who has vowed to focus on pulling Brazil out of its worst recession since the 1930s.

Meirelles told a news conference that he would work on reforms of a costly pension system that allows many people to retire in their 50s.

"Retirement must be self-sustaining over time," said Meirelles, who was widely respected for serving as Central Bank chief during the boom years from 2003 to 2010.

He also said Brazil needs to raise worker productivity, "and this comes through labor law" changes.

Temer gathered his new team at the government headquarters following a chaotic day that saw the Senate vote to impeach President Dilma Rousseff, suspending her from office and abruptly ousting nearly her entire government — a move she branded "a coup."

"Our biggest challenge is to stanch the process of freefall of our economy," Temer said at a swearing-in ceremony Thursday for the 22 ministers. "First of all, we need to balance our public spending. The sooner we are able to balance our books, the sooner we'll be able to restart growth."

He also promised to support the widening investigation into corruption at the state oil company that has already ensnared leading politicians and even implicated Temer himself — as well as several members of the new Cabinet.

His choice of ministers also raised criticism for its makeup.

"People expected brilliant Brazilians and they got a mediocre group of politicians, mostly little known congressmen," said Francisco Fonseca, a political scientist at the Fundacao Getulio Vargas think tank. "It is a very conservative, very religious cabinet, with no blacks and no women."

Brazil is a majority non-white country and six women, including one black, were in Rousseff's Cabinet when she began her second term last year.

Temer made a bid for peace with Rousseff, offering his "institutional respect" for the suspended leader, who continues to live in the presidential residence even as her replacement holds down the government offices.

"This is not a moment for celebrations, but one of profound reflection," he said. "It's urgent to pacify the nation and unify the country," he said.

Rousseff, however, vowed to fight her ouster, calling it "a coup" led by a social and economic elite that had been alarmed by the policies of her leftist Workers' Party, which had held power for 13 years.

Rousseff warned that Temer plans to dismantle government social programs that benefit around one-fourth of the Brazilian population. He insisted the programs would be maintained and "perfected" under his leadership.

But his choice to lead the Social Development Ministry, Osmar Terra, acknowledged that could be tough.

"What President Michel is proposing is that those programs be the most sheltered (from cuts). But if the budget hole is very big, we'll see," he said. "The country is bankrupt."

Rousseff, whose popularity plummeted amid the worst recession since the 1930s, is accused of using illegal accounting tricks to hide large deficits in the federal budget. Opponents argue that damaged the country, but Brazil's first female president called it baseless pretext by the elite to snatch back power.

The economy has been predicted to contract nearly 4 percent this year after an equally dismal 2015, and inflation and unemployment are hovering around 10 percent, underscoring a sharp decline after the South American giant enjoyed stellar growth for more than a decade.

Finance Minister Meirelles expressed concern about the extent of public debt, but said the right policies should restore confidence, investment and job growth.

"This can happen relatively rapidly," he said, but added, "I'm not saying it will be six months or one month or a year."

He said the government is ready for protests over its proposals, acknowledging, "The debate will be quite intense."

Rousseff will be suspended for as long as 180 days pending a trial in the Senate. If two-thirds of the 81 senators vote to find her guilty, Temer would serve out the remainder of her term, which ends in December 2018.

Temer, the longtime leader of the centrist Democratic Movement Party, had been Rousseff's vice president as part of a coalition of convenience that broke down under the strains of economic woes and corruption scandals. He is known less for a specific ideological stance than for its skill at backroom deal making.

Temer has been implicated by witnesses in the Petrobras scandal, but he has not been charged. The impeachment drive's main motor, former House Speaker Eduardo Cunha, has been charged in the scandal and was suspended last week as speaker over allegations of corruption and interfering with justice.

Several of Temer's Cabinet appointees have also been hit with corruption charges and other allegations.

But the acting president pledged that the investigation will continue unimpeded. "It deserves to be followed closely and protection against any interference that could weaken it," he said.