The Court of Accounts of the Brazilian Union (TCU) gave the green light this Wednesday to the privatization of Eletrobras, the largest electricity company in Latin America, which will become the first large state-owned company to be sold by the government of Jair Bolsonaro.
(Read: Brazil approves project to privatize the electric company Eletrobras)
By a large majority, the body that audits the accounts of the Brazilian State endorsed the sale, which according to the government could take place between mid-June and mid-August of this year.
(You are interested in: Brazil takes a new step towards the privatization of Eletrobras)
“By 7 votes to 1, I declare the winner the proposal” of the rapporteur, that authorizes the continuation of the destatization process, affirmed Judge Ana Arraes, president of the TCU, after a deliberation of more than 4 hours.
The privatization, which was already approved in mid-2021 by the Brazilian Congress, will be carried out via capitalization, through the issuance of new shares, so that the state participation in the capital of Eletrobras falls from 72% to 45%, according to analysts. .
The state will retain a veto power despite all (‘golden share’) in strategic decisions about the company, responsible for generating a third of the country’s energy.
The government’s expectation is to capture up to 67,000 million reais (13,500 million dollars at the current exchange rate), 25,000 million of which would go to the coffers of the Treasury.
The rest would go to public rate reduction and development programs, according to expert estimates.
Triumph for Bolsonaro?
A little over four months before the presidential elections, The endorsement of the TCU is good news for Bolsonaro, who since coming to power in January 2019 With the promise of shrinking the State and cleaning up public accounts, he was barely able to advance with his ambitious plan to privatize a hundred companies.
The economy minister, the ultra-liberal Paulo Guedes, estimated at the beginning of his mandate that 1 billion reais would be raised from the sale of companies (200,000 million dollars at current exchange rates).
But this goal is far from being achieved without the sale of other state-owned companies, such as Correos, Dataprev or Serpro (these last two technology ones).
The privatization of public assets is one of the great issues of the pre-campaign, especially in the midst of soaring inflation due, among other things, to the rise in the price of energy and fuel, which has led Bolsonaro to say that he does not rule out also the privatization of Petrobras, the largest company in Latin America.
“Bolsonaro has a statistician profile, he was against the privatization of large companies. The problem is that he saw that the price of energy and fuel skyrocketed and that electorally that is hitting him,” economist Alex Agostini, from the Austin Rating Consulting.
The government denies that the privatization of Eletrobras will result in an increase in the electricity bill, as its opponents and some analysts claim.
“Electricity bills will be even more expensive. But those who do not know how to govern are trying to sell strategic companies, and on top of that running to sell at bargain prices,” former leftist president Luiz Inácio Lula da Silva, leader of the government, said on Twitter on Wednesday morning. in the polls.
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