“The Lack of State Planning Is Our Biggest Problem,” Says Patricio Junior

Patricio Junior is the investment director at Terminal Investment Limited (TiL), one of the world’s largest container terminal operators. The company, owned by MSC and international investment funds, is headquartered in Geneva, Switzerland, where he currently lives. TiL controls the Portonave terminal in Santa Catarina, Brazil, and holds stakes in Brasil Terminal Portuário (BTP) in Santos and the MultiRio terminal in the Port of Rio de Janeiro.

At 63 years old and over 40 years in the port sector, Patricio Junior is considered a leading voice in the industry. A former merchant navy officer, he speaks with the authority of someone who has captained ships and led major companies in Brazil and abroad. He criticizes Brazil’s lack of investment in infrastructure and the delay in expanding port capacity—especially in Santos, the country’s largest port.

How does Brazil’s port infrastructure compare to other countries?

Each country has its way and timing of looking at business. Until last year, we had no terminal in Mexico, and then we bought one in Altamira. We also made an offer for Hutchison’s four terminals there. Mexican government officials asked us to invest even more. It’s a mindset: foreign capital must increasingly go into infrastructure because no developed country with a strong economy lacks it. Brazil is in a complicated moment—there’s a need for infrastructure and investor interest, but differences in business vision have delayed investments.

But hasn’t it always been like that? Political decisions in Brazil are notoriously slow…

True, but we’ve been growing. The population has increased. Political decisions have always been slow, but Brazil is a large country with a strong economy. There’s a gap between where we are and where we could be. How do we avoid that? With planning.

Can you give an example of poor planning?

I’ve talked about Santos’s lack of capacity for four or five years. It wasn’t a reality back then, but now it is. If we had looked ahead, we wouldn’t have faced this problem. The government has now auctioned the STS10 terminal, Tecon Santos 10. That will be ready in about three years. The auction is set for December, with the winner announced in February 2026. A ship-to-shore crane takes two years to deliver, so we’re talking February 2028. However, cargo volumes will grow by more than 10–15% in three years. Things will only worsen if we’re already operating inefficiently because everything is full. Even with a 3-million-TEU capacity, the new terminal will be nearly full. The other terminals, currently at 100% capacity, will need to reduce to 80% for efficiency so that this new one will fill up fast.

What’s the solution for the Port of Santos?

Start planning the next terminal today. We’ve already studied the possibilities for more investment in Santos. Some projects are being announced, but they’ll take five to ten years if we start now. About 40% of Brazil’s industry is in São Paulo. If the government doesn’t create a plan to drive industrialization to the North and Northeast—which have significant potential—we’ll always face bottlenecks. Brazil must be forced to plan.

And how do we do that?

We need state-level planning. It shouldn’t matter if it’s Bolsonaro or Lula in office—it should be followed because it’s for the country. The lack of state planning is our biggest problem. People are talking about a third lane on the Imigrantes Highway to Santos. We should discuss the fourth and fifth because the third is already overloaded. Once it’s finished in three or four years, will it solve the problem? No. How long will we keep saying the same thing with no action? Until yesterday, some people in Santos claimed the port had enough capacity. Check the papers and see who they were—those are the blame. Now, they’ve changed their tune. Some port authorities are claiming to have cash surpluses. But port authorities aren’t meant to hold cash—they should invest it. And if they get more money, reinvest it. That’s the purpose: not to generate revenue but to build infrastructure.

What’s your view on competition and the STS10 terminal auction? Should it be open to all, or should there be restrictions?

Ask exporters if they care about vertical integration—they don’t know what that is. They just want their cargo delivered on time and at a reasonable price. They don’t care if it’s MSC, Maersk, or CMA CGM. But if there’s no capacity, there’s inefficiency, and inefficiency drives up prices. So what’s in the public interest? Low prices with efficiency or high prices with inefficiency? Someone benefits from that inefficiency and high costs. Brazil has one of the best competition authorities in the world—Cade. It’s up to them to decide, and I trust them. I trust Antaq as well. We have good institutions—let them do their jobs. As an investor and Brazilian, I want open competition without restrictions. Brazilians keep interfering in the market, and that’s not how you improve competitiveness. If you open it up to 15 bidders, they’ll compete, and the government will get more revenue.

Regarding STS10, with increased throughput, who should be responsible for the new access routes—the winning company or the government?

Several terminals were opened that increased truck demand in recent years, and no one mentioned this. The issue has always existed. So, new terminals are built, but infrastructure isn’t upgraded. Now, whoever gets the terminal is responsible for everything that goes wrong. This terminal could move up to 5,000 trucks at peak in five years. I’m giving the current or next government five years to act. They’re also planning a cruise terminal nearby. The concessionaire will have to fund its construction. And they expect them to pay for road access, too? We’re losing perspective. A container terminal is a business. If you make it too expensive, who ends up paying? You and I, at the supermarket—because the cost gets passed on. We pay taxes for infrastructure. And now there’s a shortage? What have these people been doing for the last five years?

A bill is in Congress to change the legal framework for ports. What’s your opinion?

As an investor, I support anything that attracts more foreign capital. But we must also consider workers. And workers aren’t just unions—they’re you and me. Everyone’s interests must be considered. There must be a negotiation table because each side has its agenda. The bill has good points, but there are others that need work. I think we have an opportunity to improve the system to create more jobs and attract investment.

But is the bill good or bad? What’s your take?

It has both good and bad parts. For example? The option to extend concession periods is a good one. Infrastructure investments don’t yield returns overnight. Sometimes, it takes 10 to 15 years to see any return—and by then, you’re already in debt. Is it a good business? Yes, otherwise, we wouldn’t be in it. But there are some not-so-great aspects—which I won’t specify—but they might be good for others. But I’ve told you one good thing: the longer the concession, the better I can plan and invest. Nothing comes free.

Source: A Tribuna

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