Privatization of State-Owned Enterprises Is Topic of Debate at Seminar in RJ

Levy, Novaes, Castello Branco and Guimarães Debated State-Owned Companies Privatization at the Seminar The New Liberal Economy in Rio.

The seminar The New Liberal Economy organized by the Getulio Vargas Foundation focused on the debate around the privatization of state-owned companies. Castello Branco stated that, as a liberal, he is opposed to the existence of “99.9% of state-owned enterprises,” with the exception of the Central Bank. “Public banks should be privatized, BNDES should be abolished, and Petrobras should also be privatized,” he claimed.

Present at the event was the president of Banco do Brasil, Rubem Novaes, who advocated for the privatization of the institution. According to Novaes, even if privatized, the bank will fulfill the government’s objectives. For Novaes, if Banco do Brasil were private, it would be much more efficient, yield better returns, and could achieve the government’s goals, such as agricultural credit.

Roberto Castello Branco, president of Petrobras, who also participated in the seminar, revealed his dream of privatizing the state-owned company. He also advocated for the privatization of public banks and the abolition of the National Bank for Economic and Social Development (BNDES).

Castello predicts the sale of US$ 10 billion in the first four months of this year, within his divestment program. “Everything will depend on the market, on the speed at which we can implement the divestment portfolio,” said Castello. In his speech, he reiterated the focus on pre-salt, asset sales, deleveraging, and capital discipline.

Pedro Guimarães, president of Caixa Econômica Federal, stated that the institution operates in areas and holds assets that should not be part of a bank’s portfolio, such as shares of Petrobras. “Caixa will exit all segments that are not strategic. The public offerings will be historic. I had 70 meetings in the United States during Carnival, I have never seen anything like it; they said they believe in the structure and want to participate,” said the president, adding that the process will begin with Caixa Seguridade in September.

Levy, president of BNDES, said he is meeting with national and foreign investors interested in Brazil. “We need to mobilize these resources. With this liberal shock, we provide opportunities, options for people to place their resources in things that will make Brazil grow,” he stated.

“Using the right controls, taking the right risks, in order to respond to infrastructure challenges. We are working with several states in this regard, gas companies, energy companies. This is what BNDES exists for,” Levy affirmed.

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