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After Turkey, Brazil Hit by Widespread Protests

Christophe Simon | AFP | Getty Images

Thousands of protesters took to the streets of Brazil's biggest cities, Rio de Janeiro, Sao Paulo and the capital Brasilia, on Monday evening to protest the rising cost of public transport, corruption and heavy-handed police tactics.

In the city of Belo Horizonte, police clashed with protesters and fired tear gas to disperse crowds, Brazil's Globo TV reported.

The governor of Brazil's richest and most industrialized state Sao Paulo called the protesters "troublemakers."

The demonstrations began last week after a 0.20 Brazilian real ($0.10) increase in bus fares.

(Read More: Economic Lessons China and Brazil Can Teach Each Other)

Arnaldo Jabor, a film director and journalist said last week the protests were not about the fare hike as most of those on the streets were from the middle class.

On Sunday, demonstrators angry over the cost of hosting the Confederations Cup soccer tournament and the spending of billions of dollars on next year's soccer World Cup clashed with police in Rio.

Brazil's former President, Fernando Henrique Cardoso, who ushered in economic reforms in the 1990s, and who is now in the opposition, said on Monday the government needed to understand what had sparked the protests.

He said the protests had been prompted by poor public services, corruption and a feeling of disenfranchisement among the youth.

Cardoso, who fought against the country's military dictatorship in the 1980s, helped bring runaway inflation under control in the 1990s.

So far, Brazilian markets have show a muted reaction to the protests. On Monday, Brazil's Bovespa closed down just 0.5 percent.

On the economic front however analysts have voiced concern about slowing growth, higher inflation and the erosion of Brazil's competitiveness.

GDP in the first quarter of 2013 was weak, with growth of just 1.9 percent over the same period in 2012. Last year, the economy grew just 0.9 percent.

Inflation has also been rising, hitting 6.6 percent most recently, above the central bank's target of 6.5 percent, which some have blamed on heavy government spending ahead of next year's World Cup.

Last month, Brazil's central bank was forced to raise interest rates by a larger-than-expected 50 basis points to 8 percent.

Brazil's President Dilma Rousseff has defended her government's economic policies, which she says have alleviated poverty and helped pacify Rio's dangerous slums.

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