Brazil's development bank BNDES will oversee the privatization of state-run companies.

The program has become a priority for the bank's new president, Maria Silvia Bastos Marques, and Brazil's economic team thinks it has the potential to create a new wave of privatization in the country, according to local daily Estadão.

During Marques' swearing-in ceremony earlier this month, finance minister Henrique Meirelles said the development bank should be more than just a financier for critical infrastructure projects.

The money from the sale of the state-run companies is expected to be used to pay down government debt.

BNDES is already overseeing what will be interim president Michel Temer's first privatization, the Goiás state power utility, known as Celg, a process that began under the administration of suspended president Dilma Rousseff.

"After more than 10 years without being able to say the word privatization, BNDES will lead this process," said the secretary of the ministry of finance in Goiás Ana Carla Abrão.

After the privatization of Celg, Goiás will look to unload other assets owned by the state, Estadão quoted Abrão as saying.

The state government of Alagoas also wants to create a public-private partnership for state lab Lifal, which is currently not operating and reportedly needs an 18mn reais (US$5.37mn) investment. 

Rio de Janeiro state has agreed to privatize its water utility Cedae as well, in an attempt to renegotiate its debt with the federal government. The state currently owns more than 99.9% of the water utility, with the remainder divided among 692 shareholders.

 

Source: BNamericas

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