Government Prepares 4 Major Privatizations for the Next 3 Months

Paulo Guedes Also Stated That He Would Like to Privatize All State-Owned Enterprises and Confirmed That Correios Will Be Privatized, But Couldn’t Say When

The Minister of Economy, Paulo Guedes, stated in an interview with CNN Brazil last Sunday (07/05) that the government is preparing 4 major privatizations for the next 3 months. Petrobras Withdraws from Offshore Wind Project in Rio Grande do Norte

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The strongman of the Bolsonaro government’s economy only did not disclose the names of the companies the government intends to liquidate in the next 3 months.

Guedes further clarified that President Bolsonaro’s rapprochement with centrist parties, known as the “Centrão,” does not change the economic plans and stated in the interview that: “There was indeed this question: ‘Well, now that the president sought the democratic center, or the Centrão, will this require the staffing of state-owned enterprises?’. No. We are going to carry out 4 major privatizations in the next 30, 60, 90 days.”

Privatization of Correios

Regarding the privatization of the Brazilian Post and Telegraph Company (Correios), the minister stated that: “it is surely on the list, I just won’t say when. I would like to privatize all state-owned enterprises.”

Another point that, in the minister’s opinion, supports privatizations is the fact that the country would save a lot by selling the companies. “there is a lot of hidden value beneath the state-owned enterprises.” “The subsidiaries of Caixa are a good example. There, there are R$ 30 billion, R$ 40 billion, or R$ 50 billion in a large IPO.,” the minister declared.

The pandemic was also mentioned in the interview, and the minister spoke about the government’s aid to companies and individuals, stating that there will be an increase in public debt, “our essential concern today is no longer the fiscal black hole as it was a year ago, but rather employment, income, and health.”

In the minister’s view, the pandemic should slow down within 2 or 3 months, and for him, Brazil is already “coming out of the hole.” Guedes refers to the increase in the issuance of invoices, which rose by 2 digits in May and April.

Exports also made their contribution even during the pandemic, according to Paulo Guedes, “The external shock did not come, so we already need to revise the drop from 10% to a drop of around 6%. China needs iron ore and animal protein, and for every dollar we export to the United States, we export 3 to China. This kept us balanced,” he declared.

The tax reform was also mentioned by the minister; he stated that it should be approved still in 2020, as the text is already ready to be sent to Congress, and he hoped that the approval would come within 90 days.