Guedes blames Powers for the failure of privatizations and says it is unacceptable not to sell two SOEs

Economy Minister Paulo Guedes said on Friday (17) it was unacceptable that the Jair Bolsonaro (PL) government, elected with a liberal program that includes privatizations, would run into obstacles from other Powers to sell state-owned companies.

“It is unacceptable that it cannot be sold. If it does not look like a turtle operation, in order to disregard the popular will,” said the minister during a press conference at the end of the year.

“The president has committed to a privatization program. When he is going to privatize, are other Powers preventing privatization? This creates an unpleasant precedent,” Guedes said.

On Thursday (15), the TCU (Court of Accounts of the Union) postponed the decision on the privatization of Eletrobras, after a request for inspection made by minister Vital do Rego.

“O MME [Ministério de Minas e Energia] it did not make clear what the tariff impact will be when privatization takes place,” Vital said during the plenary session.

For the minister of TCU, there are problems in calculating the value of the grant bonus (BRL 23.2 billion) that will be paid by Eletrobras plants that will no longer operate under a subsidy and quota regime, migrating to the free environment, in which the price of energy follows market rules.

Guedes said this Friday that he will talk to minister Vital do Rego about the considerations. “The one who reassured me about this was Minister Aroldo Cedraz, who said that these are important observations, but that they do not prevent privatization,” he said.

Cedraz is the rapporteur of the process on the privatization of Eletrobras in TCU. “We hope that this goes away quickly,” said the Minister of Economy.

The other state-owned company that is stuck with privatization is Correios. The vote on the bill that allows for the sale of the company would take place in early November at the Senate’s CAE (Economic Affairs Commission), but ended up being postponed.

“We had difficulties here, there, it’s natural, sometimes the TCU makes a suggestion, sometimes the Supreme Court makes another suggestion, that’s all right. Democracy is just like that. Now, we hope that in four years it will be possible to sell two state-owned companies “, said Guedes.

The minister defended the two privatizations. According to him, both Eletrobras and Correios are undercapitalized, which compromises the companies’ investment capacity.

“It is perfectly natural for us to be able to sell two companies that are undercapitalized, cannot maintain their market share,” he said.

The government hopes to carry out the sale of Eletrobras shares on the Stock Exchange in May 2022.

Part of the TCU ministers want to help the government to carry out the sale of control of Eletrobras, a project that has dragged on since the beginning of the government of former president Michel Temer (MDB). Others feel that there are serious issues that need to be discussed further.

The privatization agenda has always been one of the main pillars listed by the minister since the 2019 campaign.

“We estimate that the debt volume will be reduced by 20% through privatizations, concessions, the sale of real estate properties by the Federal Government and the return of resources in official financial institutions. preserved,” stated Bolsonaro’s 2018 electoral program.

Despite this, the minister arrives on the eve of the 2022 electoral calendar without sales of entire companies – although divestments have advanced within companies and their subsidiaries, as in the case of Petrobras.

The minister himself said he was frustrated for not having fulfilled the objective. “I’m very frustrated that we’ve been here for two years and we haven’t been able to sell any state-owned company. It’s very frustrating,” he said in November 2020.