Brazil will tender this week the concession of 22 airports, five ports and a railway line, with the expectation to raise about $ 1.75 billion and assuage investors’ misgivings about volatility in Latin America’s largest economy.
The infrastructure auction or “InfraWeek”, between Wednesday and Friday, has attracted the interest of major international players such as the French groups ADP and Vinci, the Spanish Aena, the Brazilian CCR and the Brazilian-Argentine consortium Inframerica, according to press reports.
The question is how much these companies will be willing to offer, at a time when the coronavirus pandemic has disrupted the transportation industry and travel around the world, with Brazil in the midst of an acute political and health crisis.
“This is not the right time”Lawyer Leticia Queiroz, from the São Paulo law firm Queiroz Maluf, specialized in public-private partnership contracts, explained to AFP.
“There is not a good business environment,” given the uncertainties the pandemic has added to the always delicate question of evaluating long-term infrastructure investments, he said.
“I don’t think (the auctions) are as competitive as expected. I think there will be fewer bidders ”.
Criticisms
Originally scheduled for October last year, the auctions were postponed due to Covid, which has been charged already more than 330,000 lives in Brazil, a rank only surpassed by the United States.
The auction will take place in a complicated context, with President Jair Bolsonaro under a storm of criticism for his handling of the pandemic, in an unstoppable upward phase since February.
With his expansive style, the far-right leader used the Telegram messaging service on Saturday to promote “#InfraWeek” as the “largest airport auction in the history of Brazil.”
Bolsonaro and the Minister of Economy, Paulo Guedes, intend to show that they did not abandon the liberal agenda and that the South American country continues to be a card for the future, despite being at the epicenter of the pandemic, with an average of almost 2,700 daily deaths in the last seven days.
Bolsonaro, who aspires to re-election in 2022, caused nervousness in the market in recent weeks, dismissing in February to the president of Petrobras (controlled by the State but with shares in the Stock Market where the papers lost US $ 18,000 for that change) and, last week, with a ministerial reform that was extended to the replacement of the heads of the Armed Forces.
The Brazilian president campaigned in 2018 with promises to carry out an ambitious privatization plan and large-scale concessions to reduce Brazil’s fiscal deficit and debt.
But neither the red in public finances nor the debt have stopped growing Since then, before the millionaire expenses due to the pandemic, which has left the adjustment plans and ‘destatizations’ in the background.
Infraweek will start on Wednesday in São Paulo with the concession for up to 30 years of the operation of 22 airports small and medium-sized, including regional centers such as Manaus, the main city in the Amazon, and the touristic Foz de Iguazú, on the border with Argentina and Paraguay.
The Ministry of Infrastructure expects to raise more than 1,100 million dollars with this chapter of operations.
Thursday’s auction will be to conclude and operate the Fiol 1 freight rail line for 35 years, in the northeastern state of Bahia, considered vital for the export of iron ore and grains.
On Friday, the ministry will auction the leases of five port terminals in the northeastern state of Maranhao and in southern Rio Grande do Sul, with an expected price of $ 100 million.
Source: AFP and AP
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source https://pledgetimes.com/to-calm-the-markets-brazil-is-putting-out-to-tender-22-airports-five-ports-and-a-railroad/
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