Experts see Rui Costa’s talk about PPPs and increased concessions as a “positive sign”

Economists polled by CNN evaluated as a “positive sign”, the statement given by the future Minister of the Civil House, Rui Costa, that the new government will seek investments in partnership with the private sector and a remodeling of this model.

In an exclusive interview with CNN , Rui Costa said that the new government should encourage public-private partnerships (PPP’s) and increase the number of concessions. “We will seek to speed up the execution of these paralyzed works. As well as implementing a dynamic calling on the private sector to participate in various investment projects in the country through concessions, PPPs,” he said, exclusively, to CNN 🇧🇷

Economists point out, however, that the government must continue the concessions that have already been implemented over the last few years. “This is a positive sign if in fact the government continues with the concessions initiated in the last two previous governments. There should be no change in modelling, but continuity of what is being done now”, said Sergio Vale, chief economist at MB Associados.

Costa also said that the federal government should articulate joint partnerships with states and municipalities.

“The president’s determination is that we make the economy grow, that we do it respecting the spending limits, the resumption of paralyzed works, that we call the private sector to participate, not only with the increase of public concessions, but also the federal government participating directly or indirectly, articulating with states and municipalities the incentive and support for the realization of public-private partnership in various segments of economic activity”.

Gesner Oliveira, professor at FGV, understands that speech is important, especially within a context in which the government does not have enough resources to carry out investments.

“The state does not have the slightest condition to make all the necessary investments, mainly in infrastructure. This requires public-private partnerships. I think it’s very important to continue the PPP’s that were already being done to maintain and continue growth. You cannot paralyze or interrupt what was already under development”, he points out.

Experts note that this type of partnership is important for the country, since “investment is essential for economic growth and public-private partnership is essential for investment”, summarizes Oliveira.

However, Vale warns of the doubts that still hover over the economic plan of Luiz Inácio Lula da Silva’s (PT) third term, since the indications given with the PEC of the Explosion were not positive from the fiscal point of view.

“If the government continues with the concessions, it will be positive, as it will depend less on the State. The question is whether this will be the way to go. What has been done so far from a fiscal point of view has been very bad with the PEC. So the question remains.”

For Murilo Viana, specialist in public finance, something that marked the election of the PT government was the distrust of the financial market about how the private sector will act in the area of ​​infrastructure during the new administration.

According to specialists, another important point is to cultivate a stable regulatory environment so that, in fact, investments and partnerships are encouraged. Furthermore, the elected government must better detail the PPP models that are on the horizon.

“In principle, we do not have the details of the PPP model. It is important to understand what this modeling will be like, whether the federal government will participate and for which areas this will be done. The detail of the partnership is important for us to be able to assess the chances of success. The direction is good, not only the PPP’s, but the concession agenda itself has always been traditional in Brazil”, said Gabriel Barros, chief economist at Ryo Asset.

Adverts

President-elect Luiz Inácio Lula da Silva (PT) has begun to publicize the first names that will make up his ministerial team in the federal government as of January 2023.

The first announcement took place this Friday, with five names: Fernando Haddad (Finance), José Múcio Monteiro (Defense), Rui Costa (Civil Staff), Flávio Dino (Justice) and Mauro Vieira (Foreign Relations).