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Bolsonaro to Intensify Privatizations in Brazil – VP Mourão

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BRASILIA, Brazil – Vice President-elect Hamilton Mourão reiterated on Thursday that the future government is determined to intensify privatization processes in the country. According to him, the intention is supposedly to seek in the private sector what is not possible in the public sector.

Published on: Nov 30, 2018 @ 13:21

The statement was made to a group of businessmen and engineers at the auditorium of the National Land Transport Agency (ANTT) in Brasilia.

“If I do not have the conditions to maintain a highway, a decent contract is enough. We have to break the ideological discussion [about toll collection] and [that] we travel safely on well-maintained roads,” Mourão said.

The vice president did not detail areas or companies, but cited the need to increase partnerships between public and private initiatives. He advocated the construction of a kind of “center of government” to gather and control the main projects, policies and definition of indexes and targets set by the Executive. The information was published by Agência Brasil.

According to Mourão, the largest and most recent works occurred at the end of the military period, and Brazil accumulated misunderstandings as the decision to invest in only one mode of transport – the road. “We are hostages of a [road] class. We have to turn to all manners and we need our engineering.”

Mourão said that Brazilian contractors had made “mistakes” in the past, but they needed to get back to work in the country. “Let’s erase what’s left and recover our businesses,” he said. “Let’s return to being proud of being Brazilians. Stop being the country of the future and enter into this future.”

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According to the vice president, the challenges of the first months of administration include the auction of 12 airports managed by the Brazilian Airport Infrastructure Company (Infraero) in the next 30 years and the North-South Railroad – both scheduled to take place in March next year – in addition to the federal public works that are standing still.

The Ministry of Infrastructure, under the Jair Bolsonaro government, will be headed by the current executive director of the National Department of Infrastructure Transportation (Dnit), Tarcisio Gomes de Freitas.

Confirmed by Bolsonaro, Gomes de Freitas will concentrate decisions on the air, land and water transportation sectors. He had already anticipated that his mission would be to unlock projects to improve the country’s logistics.

It is inevitable now that Brazil’s wealth will now be concentrated in fewer hands and the profits these industries are meant to generate will not be reinvested into improving the poverty situation in the country, but rather serve the interests of capitalists and shareholders.

There is a long standing debate over the utility of privatization as a government policy. While some economists argue that it spurs economic growth in the area of normative economics, others point out that in the actual history of economic policies – in positive economics – privatization may spur economic growth but also tends to create an upwards redistribution of the wealth. Much of the argument then surrounds whether more wealth is created over-all, or if it is a zero-sum game.

In the developing world, countries that have resisted privatization, or moreover, have nationalized their productive forces – major industries and natural resources – have witnessed significant decreases in overall poverty among the population, increases in life expectancy, literacy, and other markers considered by the UN’s human development index (HDI). Here there is a debate as to whether this was because privatization in the developing world also implied foreign ownership or, similarly, capital being stored in foreign investment firms and bank accounts – or whether the legal status of private vs. public ownership, inferring that public ownership comes with economic planning and fair distribution of the proceeds, was the critical factor in and of itself.

Brazil’s commitment to ‘privatization’ will by and large be an invitation for increased foreign ownership, which will mean that wealth generated in Brazil will more readily be drawn from the national-sovereign economy of Brazil, and circulate into the globalized, se

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