Posted on November 17, 2021
Brazil’s infrastructure ministry is holding meetings with investors in the Middle East to drum up interest in concession auctions for port authorities that will take place this year.
“There are a limited number of companies in the world that have the knowhow and a real interest in taking on concessions related to port authorities, so an option for the government is to attract sovereign wealth funds and investment funds for these assets,” Fabrizio Pierdomenico, a port sector specialist at consultancy Agência Porto Consultoria, told BNamericas.
Since the start of this month infrastructure minister Tarcísio Gomes de Freitas has been holding a roadshow with investors in Abu Dhabi, including meetings with sovereign wealth funds to present the port assets that the government is offering.
“The partnership with the private sector is fundamental for transforming the country and that’s why we have the largest program of concessions in the world, without a doubt,” said Freitas, who will attend meetings with Arab investors until Wednesday.
According to a project finance expert at a Brazilian bank, who spoke with BNamericas on condition of anonymity, the concessions for port authorities attract only the interest of a limited group of foreign players which already have expertise in the area, such as the operators of the Rotterdam, Antwerp and Singapore ports, as few countries in the world allow private sector firms to operate as port authorities.
“During the pandemic Brazil’s port sector showed how important it is and now we want private investment to be revolutionary for the logistics expansion,” Freitas said in a press release from the infrastructure ministry.
During the meetings, Freitas is presenting details of the planned concession for Espírito Santo state port operator Codesa, which is considered a benchmark for other upcoming concessions, including the one for the company that operates South America’s busiest port in Santos, in São Paulo state.
Regarding Codesa, the government is awaiting authorization from the country’s audit court (TCU) to publish the tender notice and proceed with the auction. The Codesa concession is estimated to generate investments around 780mn reais (US$143mn).
As for the port of Santos, the feasibility studies are in the final stage and then there will be a public consultation period with the auction expected to take place next year. According to Freitas, the investments projected for the Santos port concession could reach 16bn reais.
