Brazil's Senate Set To Vote On President's Impeachment

BRASILIA, May 11 (Reuters) - The Brazilian Senate was expected to suspend President Dilma Rousseff on Wednesday in a vote to put her on trial for breaking budget laws, pushing a deeply unpopular leader from power and ending 13 years of rule by her leftist Workers Party.

If her opponents garner a simple majority in the 81-seat Senate in a session that will last into the night, Rousseff will be replaced on Thursday by Vice President Michel Temer as acting president for up to six months during the trial.

In a sign that Rousseff was preparing for defeat, Workers Party Senator Humberto Costa told reporters that she is expected to dismiss all her ministers later on Wednesday to give Temer a clean slate to name his own cabinet on Thursday.

With much of the nation following the momentous session live on television, the Senate began debating the impeachment trial in mid-morning. Each senator was to be given the chance to speak and the final vote was expected to take place at around 10 p.m. (0100 GMT on Thursday).

Brasilia-based consultancy ARKO Advice projected that the upper chamber would vote 57-21 to try Rousseff, the first woman to lead Brazil. The figure amounted to 78 votes rather than 81 as the head of the Senate was not set to vote, there was one absent senator and one who was ill.

That would indicate that Rousseff's opponents may well muster two-thirds of the vote needed to convict and remove her definitively from office at the end of the trial.

A Supreme Court judge denied an injunction sought on Tuesday by Rousseff in a last-ditch bid to halt the Senate vote. Justice Teori Zavascki ruled the government's argument that impeachment was flawed because it was started out of revenge by the former speaker of the lower house was "legally implausible."

Senate leader Renan Calheiros, of Temer's Brazilian Democratic Movement Party (PMDB), said as he entered the chamber on Wednesday that he would not cast a vote because wanted to retain neutrality. But he was already using the past tense when referring to Rousseff's presidency.

"Temer needs the backing of Congress to carry out deep reforms, above all reform of the political system, if he becomes president," he told reporters.

The prospect of business-friendly Temer taking power has driven Brazilian financial markets sharply higher this year, on hopes his team could cut a massive fiscal deficit and return the economy to growth.

Rousseff, in office since 2011, has seen her popularity crushed by a long-running probe into a vast kickback scheme at state-run oil company Petrobras, at a time when she was chairwoman of the company, which has tainted her political allies.

Rousseff, 68, is not accused of personal corruption, but stands charged with manipulating government accounts to disguise the size of Brazil's fiscal deficit to allow her to boost public spending during her 2014 re-election campaign, a practice employed by previous presidents.

If she is convicted in the Senate trial, Temer would then fulfill the remainder of her mandate until elections in 2018.

The political crisis has deepened Brazil's worst recession since the 1930s.

It comes less than two years after Rousseff was narrowly reelected to a second four-year term and at a time when Brazil hoped to be shining on the world stage, as it prepares to host the Olympic Games in Rio de Janeiro in August.

Opinion polls show an overwhelming majority of Brazilians want to see Rousseff impeached. But the surveys also indicate scant popular support for the 75-year-old Temer.

"I voted for Dilma, I believe in her as a leader, but I also think she has done such a bad job that it is time for her to go," said Leticia Britto, a 23-year-old business student from Sao Paulo, visiting Brasilia. "The best way forward would be to call for new elections."

ROUSSEFF VOWS TO FIGHT

Leaning toward a liberal economic policy, Temer has picked former central bank chief Henrique Meirelles as Finance Minister and, according to local media, Itau Unibanco's chief economist Ilan Goldfajn as head of the central bank.

"Temer may enjoy a honeymoon with markets for some weeks, maybe months, but when investors come to realize that the fiscal results will not improve fast enough, then we could see some disappointment later this year," said Bruno Lavieri, an economist with consultancy 4E, in Sao Paulo.

Rousseff has denied committing any crime that warrants impeachment charges. A former member of a Marxist guerilla group who was tortured during Brazil's 1964-1985 military dictatorship, she has called her impeachment a 'coup' and vowed to fight the process until the last minute.

"I will not resign, that never crossed my mind," Rousseff said in a speech on Tuesday, to cheers from supporters.

The Workers Party, determined to resist being dislodged from power, sought an injunction from the Supreme Court to block Temer from firing Rousseff's ministers and naming a new cabinet until the impeachment trial is concluded, a court clerk said.

There are worries that the tense political situation may spark protests that could turn violent after anti-impeachment protesters blocked roads with burning tires in several cities on Tuesday. The Workers Party and labor unions have called for a national strike.

Pope Francis, in his general audience on Wednesday at the Vatican, said he was praying for harmony and peace in this "time of difficulty" for Brazil.

The last time a Brazilian president was suspended from office was in 1992, when President Fernando Collor de Mello was placed on trial for corruption. He resigned from office shortly before he was found guilty.