MercoPress. South Atlantic News Agency

Brazilian Port of Santos privatization project faces further delays

If everything goes according to plan, it is anticipated that the privatization of the port will be put to the vote in the plenary in November

The acting chairman of the Brazilian Federal Court of Accounts (TCU) and rapporteur of the Port of Santos privatization process, demanded the court’s technical unit a report on the project by November 6. Minister Bruno Dantas signed the order on October 11, stressing the “relevance of the matter” and the “need for timely action”.

 “I demand the subject’s initial instruction be completed by 11/6/2022 and sent for consideration by this Rapporteur,” underlined the minister.

The TCU is responsible for analyzing the privatization projects pushed by the Federal government, which traditionally publishes the auction notices only after the court’s approval.

According to Dantas’ decision, the technical area found that the documentation submitted for consideration by the court “contains enough information for the investigation of the case.” TCU’s examiners could send their final decision to the rapporteur until December 9 if they complete the analysis in the usual amount of time.

If everything goes according to plan, it is anticipated that the privatization of the port will be put to the vote in the plenary in November. Nothing, however, prevents a minister from interrupting the debate. As of now, Marcelo Sampaio, the minister of infrastructure, has maintained that the auction could take place this year.

The TCU is expected to hold a public hearing to discuss privatization on October 31, at 2 pm, the Monday after the elections runoff.

The likelihood that the largest port complex in Latin America will be privatized is reduced if the tender does not take place in 2022. Former president Lula da Silva, who currently holds the lead in the polls of potential voters for the Presidency, is thinking about stalling the project if elected. His party’s team in charge of the proposals for the infrastructure area at least suggests as much.

Despite the urgency of the Bolsonaro government in putting the port up for auction, the Santos project arrived at the TCU with not enough details about what will be done with an area in the port where, initially, the Ministry of Infrastructure planned to create a new container terminal (STS10).

The imbroglio about whether or not to allow shipping companies to compete for the administration of the terminal abruptly delayed the government’s plan. Now, the ministry needs to define and notify the court if it still plans to lease the terminal itself or let the future concessionaire of the port decide the future of the terminal. In this case, the asset’s value in the auction must be changed.