MercoPress. South Atlantic News Agency
Temer paves the way for the privatization of jumbo power company Electrobras
The provisional measure, kick starting the formal process of selling the state’s controlling 67% stake in the utility giant, comes as Temer tries to fix the budget Brazilian President Michel Temer signed a measure that paves the way for the privatization of Eletrobras, Latin America’s largest power company, according to a government official.
Eletrobras can now join the ranks of government-run businesses that Brazil’s privatizing, with a decree that’s ready to be signed, according to Paulo Pedrosa, executive secretary for the Ministry of Mines and Energy. Its shares jumped as much as 5.5% in Sao Paulo.
The provisional measure, kick starting the formal process of selling the state’s controlling 67% stake in the utility giant, comes as Temer tries to fix a deep budget crisis. He’s seeking to attract investors to jump-start the economy following prolonged political turmoil that’s included one president being impeached, another charged with corruption and dozens of executives and politicians imprisoned over a massive kickback scheme.
It also creates conditions for the sale of Eletrobras’s indebted distribution units, according to Pedrosa. Those six units should be sold off by the middle of next year, a key step in attracting investors for the overall utility.
The planned selloff is also part of a broader effort to overhaul Brazil’s energy sector. A new regulatory framework is geared toward undoing interventionist policies created under former leaders Luiz Inacio Lula da Silva and Dilma Rousseff. Seven out of 10 Brazilians are against the privatization of state-owned companies, according to pollster Datafolha.
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Read all commentsBrazil needs to sell off it's State run companies, except for perhaps those that are truly of strategic importance, such as Itaipú hydroelectric. In the hands of the private sector, they will be administered far more efficiently and will not be used politically. The market sees this step as highly positive, reflected by the value of the the Eletrobras shares. With regards to the alleged 70% of Brazilians - according to Datafolha - who are against the privatization of State-owned companies, are those directly employed by them, already used to the privileges conceded by State owned companies - in detriment of society as a whole, that must pay for their inefficiency - and misguided people who have little comprehension of how the enormous subsidies paid to these companies, to keep them afloat, drain funds that could otherwise be used better.
Dec 31st, 2017 - 05:39 pm 0@JB
Jan 02nd, 2018 - 01:44 pm 0REF: “In the hands of the private sector, they will be administered far more efficiently and will not be used politically”:
Theoretically - in principle - makes Perfect Sense.
BUT in practice; which Big-Industry works independently - without ANY kind of meddling by the Corrupt Politicians?
REF:
https://i0.wp.com/www.humorpolitico.com.br/wp-content/uploads/2017/12/00rs1230brs.jpg?resize=580%2C405&ssl=1
@:o))
Jan 02nd, 2018 - 02:06 pm 0At least, in the hands of the private sector, the government cannot stick its hand in our pockets to cover the enormous deficits.
The “meddling” of the corrupt politicians in the private sector is not a Brazilian invention, but they certainly perfected it and took it to levels never seen before...
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