Brazilian gov’t works to improve private concession model for roads and railways

Brazil’s Ministry of Transport set up a working group to improve the “assumptions, parameters, methodology, and the economic-financial design of early contract extensions” of infrastructure assets granted to private parties, with a particular focus on road and highway concession arrangements.

Historically, the Public Power discusses whether early renewals benefit the Union. The practice by which the government extends the term of the contracts with private parties in exchange for more investments gained momentum under Tarcísio de Freitas, now governor of Sao Paulo, tenure as Minister of Infrastructure during the Bolsonaro administration.

The early renewal of railway and road concession contracts was a policy that the current Minister of Transport, Renan Filho, said, at the start of the new administration in January, could continue but would later be reviewed.

“The practice of early renewals may continue. We will discuss the topic with the audit court TCU and determine the best practices in the market. And I’m very curious to know how much the assets are worth. We need to move forward on the learning curve,” he said in January.

The group created last Monday will be made up of representatives from the Executive Secretariat of the Ministry of Transport, which will chair it, from the National Secretariat for Rail Transport, the National Land Transport Agency (ANTT), and Infra S.A, a state-owned company created from the merger of the Planning and Logistics Company (EPL) and Valec.

The ordinance establishing the group, published in Brazil’s Official Gazette on Monday, states, “Participation will be open to external agents in the sector, such as concessionaires and associations. The working group’s initial term will be for 45 days beginning on the day this ordinance is published, with a one-month extension possible,” it reads.

Source: A Tribuna

To read the original news report, check: https://www.atribuna.com.br/noticias/portomar/governo-federal-trabalha-para-aprimorar-concessoes-de-ferrovias-e-rodovias

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