Brazil business leaders welcome new rules for sanitation

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Wednesday, August 8, 2018

Brazil's powerful infrastructure association ABDIB applauded new rules for the sanitation sector, as they are expected to pave the way for new investments.

"In basic sanitation, progress has been insufficient in the last 50 years and universalization will only be possible if there is an expansion of investments that includes the most vigorous participation of the private sector, adding to resources contributed by state-run companies and the government," ABDIB said in a statement.

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In July, President Michel Temer (pictured) signed a provisory measure to attract more private sector investment in sanitation projects.

Among other factors, the government will obligate municipal governments to consult private sector companies regarding their interest in service contracts and projects, and if there is interest, the local administration will have to open a tender process. Previously, state-run water utilities had priority in winning contracts, while private sector companies could only compete for those that were not of interest to the state firms.

However, the government measure has also attracted criticism.

The national association of municipal sanitation services Assemae, along with Brazil's association of sanitary and environmental engineers ABES, the association of regulatory agencies ABAR and the association of state sanitation companies AESBE, engaged in a day of protest earlier this month in the legislative chamber of São Paulo state.

The associations pressured lawmakers to veto Temer's measure because, they allege, the measure will hurt the ability of state water utilities to invest in sanitation projects in small towns and cities.