Workshop in Washington Discusses Transport Infrastructure in Brazil
São Paulo, September 2018 – Fundação Dom Cabral, considered the best business school in Latin America, according to the Financial Times ranking, with international standard and activities on development and training of executives, entrepreneurs and public managers, launched today (Sept. 20) the study titled “Diagnosis and Projections for the Infrastructure in Transportation Logistics in Brazil,” at the IDB headquarters in Washington, during the “Investments in Transport Infrastructure in Brazil” workshop.
This diagnosis is a detailed study about projects that have been developed in Brazil, required to start a sustainable process of continuous improvements in the Brazilian transport infrastructure.
This study is a result of the Transport Logistics Infrastructure Platform (PILT/FDC), sponsored by the CCR Group, VLI, Ecorodovias, QG Infra, and Arteris, and launched in July 2017 to help governments, labor category associations and private companies identify structuring projects for the multimodal transportation network, considering a long-term planning.
According to Professor Paulo Resende, coordinator of the Logistics, Infrastructure and Supply Chain of Fundação Dom Cabral and coordinator of the Logistics Platform (PILT/FDC), the study shows that 50% of Brazilian highways will be in terrible conditions by 2025, and will still be the main type of cargo transportation. “It means an increase in logistics costs of R$15.5 billion every two years, that is, an increase of about 80 billion dollars by 2025.”
According to Leonardo Vianna, president of the CCR Group, Brazil has not prioritized planning in the last years, which ended up causing obstacles to infrastructure development. The country requires long-term planning, with structural projects protected by society, inserted in the government agenda for infrastructure. “We urgently need to ensure a more stable regulatory environment so that private investors are interested in investing in the country and participating in long-term projects without compromising the financial health of their companies.”
César Borges, President of the Brazilian Association of Highway Concessionaires (ABCR), presented a summary of the scenario of the Brazilian highways and explained that the study conducted by Fundação Dom Cabral helps detect the best projects in the short, medium and long term, especially those that show bottlenecks of logistics and land transportation in the country. “After that, the government can better allocate fiscal resources to investments.” The private sector may also support the government in this public-private partnership to continue investing and improving the system, which is critical for the recovery of economic growth. We won’t have a country with sustainable and long-term growth without an efficient infrastructure. And this study supports decisions about investments, whether public or private.”
Borges highlighted that Brazil is among the top 10 economies in the world, and it is the 73rd country in overall infrastructure ranking. “In transport infrastructure only, we are the 103rd country in the world. It is unacceptable. We have to progress a lot to see a smaller difference between the country’s economic position and our competitiveness in infrastructure.”
Bernardo Figueiredo, Transport Infrastructure Expert from Fundação Dom Cabral, emphasized in his presentation that the great challenge in highway infrastructure is to expand the use of concession contracts to ensure sustainable adaptation of the highways in the medium term.
Figueiredo also mentioned the market perception survey conducted by the Department for Strategic Affairs of the Presidency of the Republic, which concluded protection is required in case of currency exchange variation in financing, as well as more effective long-term planning, better project structuring, more adequate and predictable schedule, diversification of financing sources, guarantee of public compensations, requirements for qualification of three bidders, regulatory framework stability, reduction of uncertainties of environmental licensing, and autonomy and independence of regulatory agencies.
During the workshop, experts also discussed other important issues related to infrastructure, such as legal uncertainty in Brazil and the need for a stable regulatory environment, in addition to contractual relations between the concession authority and the concessionaires.
About the CCR Group: Founded in 1999, the CCR Group is one of Latin America’s largest infrastructure concession companies. It started in road concessions and then diversified its business portfolio; in 2017, it changed its four operations into independent companies for related businesses, which are: CCR Lam Vias, CCR Infra SP, CCR Aeroportos, and CCR Mobilidade. The companies are responsible for managing the company’s current businesses, developing and analyzing new business opportunities in the primary and secondary markets, in Brazil and worldwide. Always in the forefront, the CCR Group is today one of the five largest conglomerates in infrastructure concessions in Latin America; in addition, it was the first to start operating in the New Market of B3 (formerly BM&FBovespa). Today, it has 13,000 employees and the recognition of national and international markets due to its successful trajectory, always adopting the most rigorous practices of corporate governance, which guide its operations and are presented in the company’s Integrity and Compliance Program.
About Fundação Dom Cabral: Fundação Dom Cabral was selected in 2018 as the 12th top business school in the world by the Financial Times. Its mission is to contribute to the sustainable development of society by educating, developing and building the skills of executives, entrepreneurs and public managers. One year ago, it launched the CEOs’ Legacy initiative. This FDC-conducted initiative gathers CEOs who are oriented to the construction of relevant and sustainable legacies that can inspire people, organizations and society. More than just increasing awareness among business leaders, the CEOs’ Legacy mobilizes professionals to expand their power of influence and act as agents of progress in the construction of a better world.