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Home In a surprising investment of more than R$2 billion, Brazil financed the expansion of the metro system in Venezuela, including the cities of Caracas and Los Teques

In a surprising investment of more than R$2 billion, Brazil financed the expansion of the metro system in Venezuela, including the cities of Caracas and Los Teques

20 April 2024 13 gies: 47
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In a surprising investment of more than R$2 billion, the Brazilian government financed the expansion of the metro system in Venezuela, including the cities of Caracas and Los Teques
Photo: Disclosure/MJ

Brazil financed the construction and expansion of the metro systems in Caracas and Los Teques in Venezuela with an investment of R$2,2 billion.

The history of financing of Venezuelan subways by Brazil begins in the 90s, under the administration of Fernando Henrique Cardoso, who sought to promote Brazilian economic growth by stimulating the export of engineering services. Through BNDES, large sums were made available to Brazilian companies, including Odebrecht, to develop international projects.

The Caracas and Los Teques subways, financed with R$2,2 billion from BNDES, promised to facilitate the transport of millions of passengers. Caracas, with its system launched in 1983 and expanded over the years, had 48 stations and was more than 70 kilometers long. Los Teques, although smaller, also received a significant line extension.

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Brazilian investment in subways in Venezuela

However, the Venezuelan economic crisis and the corruption scandals involving Odebrecht, especially revealed by Operation Lava Jet, severely compromised the continuity and completion of projects. The revelations included huge amounts in bribes and illegal financing for Venezuelan presidential campaigns, further complicating the situation.

Brazilian investment in Venezuelan subways stands out not only for its amount, but also for the lost opportunity to apply such resources to infrastructure improvements within Brazil itself. The delay in the works and Venezuela's difficulty in meeting its financial commitments leave a stain on Brazilian foreign and economic policy.

Venezuela, which has been experiencing a serious economic crisis since 2010, is facing difficulties in honoring its financial commitments to Brazil. This includes payment for the development of metro projects, which are part of a larger debt exceeding $5 billion.

Deficit in public transport exceeds 850 kilometers in Brazil

Comparing with Brazilian needs, where the deficit in public transport exceeds 850 kilometers in subways and trains, the decision to finance such external projects raises questions about the priorities and management of public resources.

While Brazil continues to deal with delays in receiving payments due for projects, the story of the subways financed in Venezuela serves as a cautionary example of the risks of large international investments without adequate guarantees of return or direct benefit to the Brazilian population. The debate over the effectiveness and motivations behind these funding will likely persist, according to new developments and developments continue to emerge.

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