Brazil announces broad infrastructure tenders, privatizations

Brazilian President Michel Temer on Tuesday announced his new Investment Partnerships Program (PPI), which aims to revive the national infrastructure sector through a series of tenders and privatizations.

The first phase of PPI will cover 25 important projects, including concessions for major airports, highways, railways, electricity distribution companies, hydroelectric plants and oil and gas fields.

Concessions for the airports of four major cities, Porto Alegre, Salvador, Florianopolis and Fortaleza, will be chosen in the first half of 2017.

The second half of the year will see concessions handed out to top major highways, BR-364/365, linking Goias to Minas Gerais, and BR-101/115/290 in Rio Grande do Sul.

Six energy distribution companies, which are currently owned by state utility, Eletrobras, will receive private sector concessions, including Amazonas Energia, Boa Vista Energia, Eletroacre, Ceal, Cepisa and Ceron. These will take place in late 2017 and early 2018.

Three hydroelectric plants, Sao Simao, Miranda and Volta Grande, will all be tendered out in 2017.

This broad agenda marks the beginning of Temer to fulfill his privatization pledges since being confirmed as president after the impeachment of Dilma Rousseff.

At a speech announcing the plan in Brasilia, Temer said that his government would provide judicial security and regulatory stability to the private sector "in order to create the proper environment for the realization of private investment."

"The government cannot do it all, but it must always act as an agent to facilitate growth and employment," he added.

In a document sent to Congress accompanying the plan, the Temer government harshly criticized "unsustainable" negotiations held with the private sector in the past.

"To face the most severe economic crisis in its history, Brazil sees itself needing to improve its infrastructure," read the document. Endit