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Brazil’s President Rousseff Announces Major Logistics In...

Brazil’s President Rousseff Announces Major Logistics Infrastructure Investment Plan

The new stage of the Logistics Investment Program (PIL), launched on June 9, 2015 by the Brazilian government, provides concessions for sixteen stretches of highway and six railways, totaling R$ 152.5 billion in these areas. The government intends to hold five auctions for the the highways in 2015 and eleven more in 2016. The plan

Santos Port in São Paulo, Brazil

The new stage of the Logistics Investment Program (PIL), launched on June 9, 2015 by the Brazilian government, provides concessions for sixteen stretches of highway and six railways, totaling R$ 152.5 billion in these areas. The government intends to hold five auctions for the the highways in 2015 and eleven more in 2016.

The plan provides a total of R$ 198.4 billion in investments and also includes concessions for airports and ports. The package to stimulate infrastructure is one of the main bets the government has made to help unlock the economy in the upcoming years. An interactive visualization of the investment package can be found here.

In accordance with Minister of Planning Nelson Barbosa, the new step is a response to the increase in production, the automobile fleet and the movement of passengers and cargo in the country’s ports. “There is a large demand for infrastructure in Brazil, and this guarantees that there will be demand. If there’s demand, there’s investment,” he assessed.

For highways, the concession will follow the auction model for the lowest tariff, as happened with the Rio-Niteroi Bridge whose concession was renewed this year. Apart from the transfer of highways to private sector administration, the package provides eleven new highway projects.

Aeroporto Internacional de São Paulo-Guarulhos, Brazil

For railways, the concession model will be in accordance with the specific characteristics of each enterprise. In the list of projects, there are stretches of the Ferrovia Norte-Sul and the construction of a railway between Rio de Janeiro and Vitória. These are in addition to the transoceanic railway, in partnership with Peru, which will link Brazil to the Pacific Ocean.

R$ 40 billion of investments are required for the 3.5 thousand kilometers of the Brazilian part of the Bioceância Railway. The understanding agreement between Brazil, China, and Peru for the work has already been signed. The deadline for when the studies must be finalized is May of 2016.

In accordance with President Dilma Rousseff, the railway will represent access to the Asian market. “This means a new and extremely strategic positioning for international relations,” said the announcement of the PIL. In total, the new stage of concessions provides $R 86.4 billion to be invested in six blocks.

In addition to the Bioceância, concessions are provided for two North-South stretches of rail. One of them will connect Anápolis (economic capital of the state of Goiás) to Palmas (capital of the state of Tocantins). The concession for this railway stretch, which has already been constructed, will be conditional on the construction of a new stretch. “The railway will have a total extension of 1,430 kilometers. By constructing the stretch between Açailândia and Bacarena, we are going to improve the passage of products to the northern ports,” said Barbosa. The total investment provided for the project is R$ 7.8 billion.

Trucks transporting soybean crop in Mato Grosso, Brazil

The second stretch of the North-South railway to be auctioned is of 895 kilometers and will connect Anápolis, Estrela D'Oeste (São Paulo state) and Três Lagoas (in the state of Mato Grosso do Sul). The estimated investment is R$ 4.9 billion, with the objective of not only completing the North-South corridor with a southern railway stretch, but also interconnecting it with the agro-industrial hub of Três Lagoas.

The rail concessions will also cover 1,140 kilometers of railway that will connect Lucas do Rio Verde (in Mato Grosso) to Miritituba (Parana), with a cost of R$ 9.9 billion. The works seek to improve the flow of agricultural products from Mato Grosso to the Tapajós Waterway.

Finally, 572 kilometers will be awarded for a railway that will connect Rio de Janeiro to Vitória. “This railway branch has been the subject of studies done by the governments of both states,” said President Rousseff. The estimated cost is R$ 7.8 billion. With the project, the government intends to integrate ports and railway terminals of the two states. The government projects yet another R$ 16 billion in new investments to the existing concessions.

How prominent a role do public-private partnerships play where you live? Have they been cost effective? Are the new facilities affordable to the users? Share your thoughts and your city's stories in the comments area below. 

Original article, originally published in Portuguese, here.

Credits: Data and images linked to sources.

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