Tarcísio meets Lula and tries to convince him not to block the privatization of the Port of Santos

The Governor of São Paulo, Tarcísio de Freitas (Republicans), met this Wednesday (11) with President Luiz Inácio Lula da Silva (PT) and tried to convince him to give up the idea of ​​blocking the privatization of the port of Santos , the largest in Latin America.

This was the first closed meeting of the former minister of Jair Bolsonaro (PL) with the PT. Freitas was the target of criticism from militancy for having participated in a meeting of governors with Lula, last Monday (9).

“In the campaign, I said that I would respect and work with all the governors, for the good of Brazil. That’s what we are doing”, said Lula, about the meeting, on social networks.

In addition to Lula and Tarcísio, ministers Alexandre Padilha (Institutional Relations) and Rui Costa (Casa Civil) participated in the meeting at the Planalto Palace, in addition to the Secretary of Government and Institutional Relations of São Paulo, Gilberto Kassab.

The signal that the process of privatization of the port of Santos would be paralyzed had already been given by the transition team of the government, which recommended to the president to privatize the access channels to the port.

According to the governor’s interlocutors, he left the conversation excited, which they described as an initial one to show how important the topic is for Baixada Santista.

They also said that Tarcísio would be open to adapting the privatization model, but without details.

The model, a project led and defended by Tarcísio when he was Bolsonaro’s Minister of Infrastructure, provides for private investment of at least R$ 30 billion to expand the port’s outflow capacity.

The proposal is to transfer the port authority –the state government that manages the site, warehouses, yards, canals, land and rail access roads– to whoever wins the auction.

This modeling was approved by the TCU (Tribunal de Contas da União), a sort of early green light for Lula to decide what to do in relation to the port.

With Lula’s decision to remove the port from the National Privatization Plan, the way out to improve infrastructure would be through concessions for port terminals and allocation of Budget resources to expand the access rail network, which is interconnected to the other routes that they bring products for export – especially agricultural crops from the Midwest and ores.

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 transshipment. This scenario, according to government technicians, will lead to outflow through the North or to more expensive solutions, making exports less competitive.