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Brazil Probe of Petrobras Seen Spurring Positive Business Agenda

FILE - The headquarters building of Brazilian state oil company Petrobras in Rio de Janeiro.

A corruption probe at Brazil's state-run oil company, Petrobras, is likely to promote less government intervention and more transparency, economists and analysts said on Tuesday.

The investigation could, however, also stir more political infighting, extend the scandal to other state companies and even put the brakes on an expected economic recovery next year, said Chris Garman, head of Latin America at political risk consultancy Eurasia Group.

Garman and other speakers at a seminar sponsored by ItaDu BBA said that a positive consequence from the current scandal was the revision of rules governing the exploration of massive offshore oil reserves in an area known as the sub-salt.

Another possible change would be easing minimum thresholds for Brazil-made content in the equipment used by Petrobras.

Fallout from the scandal at Petroleo Brasileiro SA, the formal name of the state-controlled oil company, has already led President Dilma Rousseff to engage in a more business-friendly policy agenda, economists said.

"Although these don't seem to be full-blown reforms, the current adjustment policies are helping Brazil distance itself from a crisis, and that's good," said Ilan Goldfajn, chief economist of ItaDu Unibanco Holding SA. ItaDu is Brazil's largest bank by market value.

Andres Velasco, a former Chilean finance minister, said Rousseff was heading in the right direction with efforts to dismantle years of budget profligacy, aimed at reducing national debt and adapting to lower commodity prices.

Brazil and other countries in Latin America were faced with tough times because of the end of the commodity boom, he added.