Sep 10, 2020

The Brazilian Development Bank (BNDES) participated, this Wednesday, 9, in the kickoff with the DAGNL consortium for executing the privatization studies of the ports of Santos and São Sebastião, in the state of São Paulo,  in a meeting held by the Ministry of Infrastructure with Santos Port Authority (SPA) and the Port of São Sebastião. The winning consortium, composed of DTA Engenharia, Garín, Alvarez & Marsal, and the law firms Lobo De Rizzo and Navarro Prado Advogados, should begin studies in September, due for completion in the second quarter of 2021. The privatization auction is scheduled for 2022.

“If our concession program were the Brazilian championship, surely the Port of Santos would be in the G4. We are making history. We will build a new chapter in Brazilian port history. We are turning over a new page on this sector. Despite advances, there is still much to do,” said Minister Tarcísio Gomes de Freitas. He emphasized that the privatization project is considered by the Federal Government as one of the most important.. 

The current stage will define the best operating model of the two ports. In privatization, the State transfers an activity or asset to the private sector by sale, concession or permit. It is expected that the entry of the private sector in the management of ports will generate a greater investment flows and more dynamic port activity, besides the modernization and improvement of service levels, increased efficiency, more competitiveness (internal and external), as well as incorporating international best practices.

BNDES’s president, Gustavo Montezano, explained the Bank’s acquired experiences from the studies already initiated on the privatization process of the Companhia Docas do Espírito Santo (Codesa). According to him, the Port of Santos is a kind of “crown jewel.” “Our main agenda is to improve Brazil’s gross domestic product (GDP), and consequently reduce inflation and generate more employment. We are enthusiastic and will spare no efforts to make this happen,” he said. 

From signing the contract with BNDES, the Bank is responsible not only for the studies and modeling of the privatization of port projects, but also for enabling the public hearings and the auction, following the process until the signing of the contract between the public sector and the winning private partner. 

Fernando Biral, SPA’s CEO, reinforced that the privatization will bring unprecedented professionalization to the sector. “The port is an essential and decisive asset for our trade balance. It has to operate efficiently. We want to support agribusiness to improve the logistics chain and increase competitiveness. We can no longer wait for investments. We have a series of structuring projects to be carried out and the private sector will be able to operate faster,” he pointed out. 

Port of Santos – The port numbers are superlative and highlight the importance of attracting private initiative in the privatization process. In 2019 alone, there were 134 million tons moved, net revenue of R$ 967.3 million and net profit of R$ 87.3 million. The annualized growth rate is about 5%.

Port of São Sebastião – The port complex of São Sebastião moved 740,500 tons in 2019, an increase of 6.5% over the previous year. Among the main cargos are: dry bulk (94.2%), general cargo (3.5%) and liquid and gaseous bulk (2.3%). Even with the increase in the volume transported, the port’s  accumulated net loss exceeds R$ 43.5 million – one of the main arguments for privatization.

About BNDES – Founded in 1952 and currently linked to the Ministry of Economy, BNDES is the main instrument of the Federal Government for the long-term financing of the Brazilian economy. Its actions focus on socioenvironmental and economic impacts in Brazil. BNDES offers special conditions for micro-, small- and medium-sized enterprises, 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 formulating solutions for resuming economic growth.