Brazil is promoting its billion-dollar infrastructure concession plan to U.S. investors

RIO DE JANEIRO, BRAZIL – Brazil’s Minister of Infrastructure, Tarcisio Freitas, hit the road on Monday (4) for a series of meetings with investors in the United States to promote the ambitious concessions program with which the country plans to attract investments of up to R$260 billion (about US$49 billion).

Freitas has scheduled several meetings in New York between today and next Friday with investors, executives of financial institutions and funds, and representatives of risk rating agencies, his portfolio advised in a statement.

The meetings aim to promote the dozens of concessions of airports, ports, roads, and railroads that the government of President Jair Bolsonaro intends to auction off between October this year and December 2022 when his term ends.

With such concessions, Bolsonaro, who promotes an economic policy of unmistakable liberal tinge that seeks to reduce the size of the State, intends to attract investments to Brazil for almost US$50 billion in infrastructure without counting what the government will receive for the respective licenses.

According to the Ministry, this is Freitas’ first opportunity to present his portfolio of projects abroad since the disruption caused by the Covid-19 pandemic.

In 2019, before the pandemic, the minister toured the United States, Spain, Germany, and England to present the then privatization and concession plans of Brazilian companies, many of which have already been awarded or sold.

According to the Ministry, new companies were added to the plan last year to make Brazil’s concession program one of the most robust and ambitious in the world.

“I am very optimistic about this series of meetings that promise to be productive for Brazil’s logistics with the participation of important infrastructure operators on the world stage,” said the minister, quoted in the statement.

“With our program, we are transforming Brazil’s infrastructure, reducing logistics costs, providing more competitiveness, and benefiting users,” he added.

According to the Ministry, since the beginning of Bolsonaro’s mandate, in January 2019, the Government has signed contracts to grant to private initiative the operation of 34 airports, five highways, six railroads, and 29 port terminals, in addition to having granted licenses for the operation of 99 remote port terminals.

These concessions have guaranteed investments of R$74 billion (nearly US$14 billion), almost a quarter of what is intended with those to be offered until 2022.

Brazil is planning eleven auctions between October and November to grant nine port terminals and two sets of highways, including the Via Dutra, the busiest federal highway in Brazil, which connects Sao Paulo with Rio de Janeiro.

An auction is also planned for the lease of two fuel terminals in the port of Santos, the busiest port in Latin America.

Among the auctions scheduled for 2022 are: the concession of 16 airports, including Congonhas in São Paulo and Santos Dumont in Rio de Janeiro, two of the busiest airports in Brazil; the privatization of part of the port of Santos; the concession of 12,000 kilometers of federal highways; and the bid for a significant railroad between the states of Mato Grosso and Pará.

According to calculations by the Ministry of Infrastructure, Brazil can attract one trillion reais (about US$ 189 billion) in private investments with the concessions already carried out and those planned between 2019 and 2022.

In addition to infrastructure concessions, this value includes the investments that the country can attract with the concessions made by the Ministry of Mines and Energy to lay transmission lines, exploit oil and gas, and build and operate hydroelectric plants and thermal wind and solar generators.

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