Ports and Terminals

In Brasilia, Sao Paulo governor clings to Port of Santos privatization demands

Mar, 13, 2023 Posted by Gabriel Malheiros

Week 202313

The Sao Paulo state governor, Tarcísio de Freitas, defended once again at a meeting with Chief of Staff Rui Costa that privatizing the Port of Santos is the best way to avoid “competitiveness loss.” According to him, it is possible to “mitigate” the risks surrounding privatization, and thus, his administration feels “optimistic” about the ongoing negotiations with the federal power.

“We were able to hold a very technical debate [about the concession of the Port of Santos]. We discussed what we had already designed regarding the concession model back then. We also defended the importance of going forward with this process for the region’s development. I reckon that we have evolved a lot after this meeting, which was the idea of president Lula himself. We left it quite satisfied and optimistic.”

According to the governor, the Chief of Staff team listed possible attention points that worry the Executive. “We showed the blueprint of our [concession] project. And they listed points of concern. So we added a few mitigation points to counter these points of attention. I understand we reached a starting point now.”

Governor Tarcisio cited, as an example, the fear private operators have regarding whether contracts will be kept long-term. “I understand the model presented is effective concerning political stability. And we managed to move forward in those regulatory challenges, so these contracts will be preserved the way they were conceived back then,” he argued.

Furthermore, the governor of Sao Paulo defended the fact that the fees and costs of the Port of Santos tend to fall as a result of privatization. “Tariffs are kept, but, in fact, they fall with the concession, so there is no cost increase. The concession of the Port of Santos has a lot to do with the port’s competitiveness. We will lose competitiveness if we do not invest heavily in expanding and deepening the channel.”

Finally, Tarcísio said that possible points of concern can be regulated later. “With regard to market share within the port, tariffs, leasing value, all of this can be perfectly defined by the granting authority and regulation. There are mitigation mechanisms for these risks. We can bring peace of mind to the market that the model we developed is very successful. ” Nothing is more transformative for the region than the Port of Santos concession because nothing will mobilize so many resources in such a short time,” he concluded.

Tarcísio de Freitas went to Brasilia accompanied by his secretary of State Institutional Relations, Gilberto Kassab. The project to privatize the port was championed by Tarcísio when he was Minister of Infrastructure in the Jair Bolsonaro government, but it was not completed in that administration.

Because of this, Tarcísio has been coming to Brasília to discuss the issue with members of the new government. He has even spoken with President Luiz Inácio Lula da Silva. In January, after one of these meetings with Tarcísio, Rui Costa stated that the government “has no dogmas” about the privatization of the port. And he cited privatization or a PPP (public-private partnership) as possibilities to attract investment.

The Minister of Ports and Airports, Márcio França, whose political cradle is the city on the coast of São Paulo, ruled out the privatization of the Port of Santos but said he was “open to talking.”

Source: Valor Econômico

To read the full original report, please access: https://valor.globo.com/brasil/noticia/2023/03/10/no-planalto-tarcisio-se-diz-otimista-com-privatizacao-do-porto-de-santos.ghtml

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