In BNamericas' 2015 Infrastructure Survey, over 70% of participants active in Brazil described the state of the country's infrastructure as "poor." So it is perhaps not surprising that the South American giant has ambitious goals to overcome its shortfalls.
Data from national development bank BNDES indicates infrastructure investment will total some US$202 billion between 2015 and 2018, or 30.6% more than in 2010-13. Of the projected total, about US$70 billion is destined to the construction and development of transport infrastructure and urban mobility. Among the major projects open to private investment and operation are federal highway concessions, subway systems, monorails, light rail systems, railways, international and regional airports, public port concessions and the operation of private terminals, as well as water supply and sanitation works.
Armando Castelar, an economist at the Brazilian Economics Institute (IBRE) of the Getulio Vargas Foundation (FGV), a local think tank, argues that despite the country's economic rut, projects should still go ahead, given the the fact that infrastructure investments are less susceptible to short-term fluctuations due to their long-term nature, and because of the tremendous shortage of transport and other services in the country (in essence, the need exists). The government has also insisted that the concessions program will continue as planned.
But the reality is complicated, and raises questions about costs and if projects can be completed on time, if at all. Of greatest concern is the corruption scandal at state oil company Petrobras. Known as 'Operation Car Wash', the scandal involves the country's biggest construction companies and has already impacted the development of projects. Serious inefficiencies in management, problems in the supply of water and energy, and controversial regulatory requirements add further obstacles to the progress of new projects.
This report will look at the state of infrastructure in Brazil and assess the viability of its landmark works.