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Wednesday, November 30, 2022
HomeEconomyPanel SA: New government puts Santos privatization in check

Panel SA: New government puts Santos privatization in check

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Port operators and investment funds interested in the privatization of the port of Santos, the largest in Latin America, pulled the handbrake in front of the signal given by the team of the president-elect, Luiz Inácio Lula da Silva, that the project will be reviewed by the new government .

The impasse has already sanctioned the postponement of the auction, which was scheduled for this year. However, it has not yet been made official.

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People participating in the discussions say that the team linked to Miriam Belchior, infrastructure coordinator on the transition team, is considering authorizing only the privatization of access to the canal, in Santos — and not the entire infrastructure (port and canal).

As it was sent to the TCU (Tribunal de Contas da União), the project foresees at least R$ 30 billion in investments to expand the port’s outflow capacity. The grant will cost around R$10 billion, considering the port and access to it.

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With a project to privatize only access (inland waterways), everything changes.

Today, the project foresees that current operators in Santos can join a consortium to acquire the port, as long as their participation is restricted to 5% —a way to avoid that a single group controls the entire port.

Technicians involved in the project claim that the privatization of only access to the port restricts the interest of private groups too much, which would delay investments so that the port receives, in the coming years, much more cargo.

The privatization of the port was idealized by the team of the former Minister of Infrastructure, Tarcísio de Freitas – governor-elect of São Paulo. At the time, privatization was conceived by Tarcísio together with that of railway concessions, especially those departing from the Midwest transporting the agricultural harvest to Santos.

Under the railway concession contracts, the volume of transported cargo is expected to double as a result of previously defined investments.

Today, the port does not have adequate railroads and terminals to meet this future demand.

If these investments are not made with the future change of course by the new government, there will be a chain reaction, imposing a financial imbalance on the railway concessions.

That’s because they won’t have the necessary income. Faced with the inability to flow at the port, the cargo will arrive there, but will wait for transhipment. This scenario, according to government technicians, will lead to outflow through the North or to more expensive solutions, making exports less competitive.

Julio Wiziack (interim) with Paulo Ricardo Martins and Diego Felix

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Debra
Debra
I have over 10 years of experience working in the news industry. I have worked for several different news organizations, including a large news website like News Bulletin 247. I am an expert in the field of economics and have written several books on the subject. I am a highly skilled writer and editor, and have a strong knowledge of social media. I am a highly respected member of the news industry, and my work has been featured in many major publications.

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