Future minister defends revising railroad framework and using public resources in the sector

The new Minister of Transport, Renan Filho (MDB-AL), defended this Thursday (29) “rebalancing” the railroad framework to make it “more attractive” to the private sector. He also said he was in favor of expanding public resources to resume investments in the country.

Renan Filho spoke at the CCBB (Centro Cultural Banco do Brasil), headquarters of the transitional government, shortly after being announced as minister by the graduated president, Luiz Inácio Lula da Silva.

Senator elected by Alagoas and son of Renan Calheiros (MDB-AL), the future minister spoke calmly when dealing with the review of concession contracts. “When the government wants to review the contract, everyone is against it. When the productive sector wants to review the contract, the defense is sometimes broader.”

“I’m not against taking a look, revisiting the contracts. We have to be calm about this. Because in general the contract must be respected. Specifically, let’s take a look. But we need to improve the quality of new contracts “, said. “We need to review the model to do things better from now on.”

“For example, in the railway sector, our model is not attracting private capital, because Brazil is a country of continental dimensions”, he said. “We have to take a look to see if railroads can be maintained with private resources alone or if we need to make a new, different model.”

“All over the world, for us, railroads were built with public funds. The problem is that today’s world no longer has the resources available to build the railroads that were built in the past. So we need to take this into account and see how to meet this challenge.”

Renan Filho defended that the railroad framework be rebalanced. “The PPP [parcerias público-privadas] are difficult to keep upright”, he added.

The New Legal Framework for Rail Transport was sanctioned by President Jair Bolsonaro (PL) in December 2021.

Under previous rules, companies could only explore the country’s rail network after participating in a concession auction held by the federal government.

The current concessionaires, if harmed by the change or if they commit to expanding the service, may migrate to the new model, provided that the current contractual obligations regarding investments and maintenance of passenger transport are respected.

Renan Filho also said that Lula was right to place roads and railways under Transport and appoint a ministry for ports and airports. According to him, the new government will prioritize the resumption of investments. “A long time ago, Brazil reduced its investment capacity a lot and with the PEC [proposta de emenda à Constituição] that was approved [que garante R$ 600 para o Bolsa Família]the country recovers its ability to invest in an agile and quick way.”

“We are going to resume investments expanding the capacity of the federal government to reach all parts of the country because in some regions there has been little investment made over the last few years.”