Nov 17, 2020

The Brazilian Development Bank (BNDES) and the Government of the State of Santa Catarina signed, this Tuesday, the 17th, a contract to create a public-private partnership (PPP) for the construction, modernization and operation of a penal complex in Blumenau. The prison complex will have the capacity for more than 3,000 male prisoners. The project could be replicated in other locations across the country, becoming a benchmark for a new standard, with a focus on modernizing the management and rehabilitation of detainees through the development of professional activities.

The new complex will replace a unit already in operation located in downtown Blumenau, which is outdated and in a densely populated area. In addition to promoting the reinsertion of prisoners in the labor market and contributing to the acceleration of their reintegration into society, the initiative also seeks alternatives to optimize public spending in the prison system.

“This partnership will allow the construction of a Prison Complex, through a PPP, in a better location, enabling the deactivation of Blumenau’s Regional Prison in the future. This is an old desire of the population”, said Governor Daniela Reinehr.

BNDES’s work will consist of modeling the privatization project and preparing the bidding process, which will be conducted by the state and culminate in the concession of the prison unit. “This project inaugurates BNDES’s relationship with Santa Catarina in the field of PPPs and concessions, and we hope to become a partner of the state in similar projects going forward, making the attraction of private capital feasible to improve the quality of life of the population,” points out Pedro Bruno, superintendent of the Government and Institutional Relationship Area of BNDES.

“PPI’s mission is to help city halls and states in the development of public-private partnership projects. The main objective of this partnership is the re-socialization of prisoners through work and study. This project will create almost three thousand resocialization vacancies within this new penal complex, which is good not only for Santa Catarina, but for Brazil,” said Wesley Cardia, Secretary of Promotion and Support to Federative Entities of the PPI.

According to the National Penitentiary Department of the Ministry of Justice and Public Security (DEPEN/MJSP), between 2009 and June 2019, the prison population in Brazil grew 63% and the investments made in the period to increase the number of vacancies only followed the growth in the number of prisoners, with high rates of prison overcrowding remaining constant.

Partnership with IDB – The Blumenau project will also count on the support of the Inter-American Development Bank (IDB) to perform technical studies prior to the structuring of projects by BNDES. Support will be formalized through a technical cooperation agreement to be signed between BNDES and IDB for the structuring of PPPs, which aims to increase the availability of infrastructure and improve the management of prison units in the states of Rio Grande do Sul (RS) and Santa Catarina (SC).

The importance of the agreement with the IDB for the elaboration of these alternatives is due to the institution’s high credibility and vast experience in the public security sector, and in the structuring of PPPs in Brazil. The agreement also brings the opportunity to add the knowledge of experts and about international experiences, improving the assessment and selection of current best practices on a global scale.

The agreement will be formed in the context of the Memorandum of Understanding signed on October 10, 2019 between BNDES, IDB and the Federal Government, through the Ministry of Justice and Public Security (MJSP), which aims to promote programs and projects that contribute to boost effective and innovative investments aimed at improving public security in Brazil.

About BNDES – Founded in 1952 and currently linked to the Ministry of Economy, BNDES is the main instrument of the Federal Government to promote long-term investments in the Brazilian economy. Its actions focus on the socioenvironmental and economic impact in Brazil. BNDES offers special conditions for micro-, small- and medium-sized enterprises (MSME), as well as social investment lines, directed at education and health, family agriculture, sanitation and urban transport. In crisis situations, BNDES acts in an anticyclical manner and assists in the formulation of solutions for resuming economic growth.

About PPI – PPI works to expand and strengthen the interaction between the State and the private sector via the signing of partnership contracts for the execution of public infrastructure projects and other privatization measures. Since 2019, the program works alongside states and municipalities, providing technical, financial and institutional assistance to produce feasibility studies, proposals for regulatory improvements and attracting investors. The structuring of state and municipal concession projects is paid for by BNDES, with subsequent reimbursement by future concessionaires.

About IDB – The Inter-American Development Bank is dedicated to improving lives. Established in 1959, IDB is an important source of long-term financing for economic, social and institutional development in Latin America and the Caribbean. IDB also conducts cutting-edge research and provides advice on policy-making, technical assistance and training for clients of the public and private sectors of the region. Historically, IDB is BNDES’s largest international creditor, with 22 contracts signed until now, totaling US$ 8.75 billion. BNDES and IDB have several ongoing joint initiatives in different areas, including the preparation of projects in public security, solid waste, health, sanitation and support to MSMEs and social infrastructure actions.