Brazil adds green touch to updated PPI program

After previous environmental policies provoked a global outcry that damaged Brazil's image, the Jair Bolsonaro administration is now trying to make the investment partnerships program (PPI) greener.

Among the 22 projects the PPI council added to the program during its latest meeting are concessions for nature parks like Canela and São Francisco de Paula in Rio Grande do Sul state, and three forest reserves in the Amazon region, Floresta Humaitá, Iquiri and Castanho.

Concessions for the parks are geared toward developing ecotourism, and the concessions for the forest areas focus on sustainable production.

"The parks will be granted in a way to explore tourist capacity, in addition to environmental protection,” the PPI program's environmental licensing and expropriation secretary, Rose Hoffmann, said.

“The Amazon forests assets will be offered for the exploration of forest resources on a sustainable basis,” Hoffmann said, adding that concessionaires will seek ways to sustainably produce wood.

FOREST DETAILS 

Humaitá Forest is a 468,000ha conservation site managed by the Chico Mendes biodiversity institute (ICMBio). About 310,000ha can be used for business management. The auction for this area is planned for the fourth quarter.

Iquiri National Forest is a 1.47Mha federal conservation unit, also managed by ICMBio, of which about 883,000ha can be used for business. The auction is planned for the second quarter of 2021.

Meanwhile, the auction for the 165,000ha Castanho forest, of which 120,000ha can be used for business, is also planned for 2Q21.

INFRASTRUCTURE CONCESSIONS

During the PPI meeting - the first after the program went from the president's chief-of-staff to the economy ministry - five infrastructure projects were included.

The BR-040 highway can now be re-tendered as concessions for five ports will be up for grabs.

Investment for the 942km BR-040 between Brasília and Juiz de Fora, Minas Gerais state, is estimated at 7.4bn reais (US$1.72bn) and the auction should take place in September 2021.

Original concessionaire Invepar formalized last year its request to return the concession, because it could not comply with the contract and invest in maintenance and widening as the economic crisis negatively impacted traffic.

Port terminal auctions are planned for Aratu-Candeias (ATU18), Bahia state; Santana (MCP02), Amapá state; a terminal in the port of Maceió (MAC10), Alagoas state; in Paranaguá port (PAR50), Paraná state; and one in Pará's Vila do Conde port (VDC10).

Combined investments are expected to reach almost 724mn reais.

ICT 

The PPI list also includes the state-run center for excellence in advanced electronic technology (Ceitec), linked to the technology, innovation and communications ministry (MCTIC). 

Putting Ceitec on the PPI list will “make it possible to conduct studies and evaluate alternatives for partnerships with the private sector and propose efficiency gains for the company,” the ministry said. 

PPI RESULTS

Since its creation in 2016, during the Michel Temer administration, 287 projects have entered the concession or privatization program, of which 172 have been auctioned or sold.

The government has received 137bn reais in grants payments so far as the program is expected to generate 700bn reais in investments in coming years.