Brazil Seeking Greater Private Investment to Better Position in World Economic Forum Ranking
RIO DE JANEIRO, BRAZIL – The federal government released on Wednesday, August 1st, in São Paulo, the first part of Pro-Infra, the action calendar for logistics, energy, basic sanitation, urban mobility, telecommunications, and low-income housing of the Ministry of Economy.
According to the special secretary of Productivity, Employment, and Competitiveness of the Ministry of Economy, Carlos Alexandre Jorge Da Costa, the actions are based on three main pillars: reducing government involvement in infrastructure projects; increasing the participation of the private sector; and providing long-term, stable and intersectoral planning centered on economic efficiency.
“It’s not about reducing public spending or public investment in infrastructure. We need to reduce it, but by increasing private investment much more,” said the secretary.
Among the goals set in Pro-Infra are to raise Brazil’s current position (81st) to 71st place in the World Economic Forum’s infrastructure ranking by 2022, and increase annual investment in infrastructure from 1.6 percent to 3.8 percent of gross domestic product (GDP).
According to Da Costa, the government is looking for more intelligent use of public funds, and a “big leap” in private investment, “which in general is better quality investment, better managed, more effective, which provides greater technology.”
“We have witnessed a replacement of private investment by public investment in recent years. Either public investment was increased, or more credit was given to public investment, or more credit was given by the BNDES [National Bank for Economic and Social Development].”
Da Costa estimated that the country could experience GDP growth of more than four percent should it succeed in carrying out structural reforms, such as social welfare and taxation.
“If we can pass the Social Welfare reform bill, the shock of private investment in infrastructure, State reform, tax reform, the “Simplifica” Program, and progress with the several legal milestones in the “Competitiveness for Prosperity” program,” he said.
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