Lula 2.0? Brazil’s maritime sector watches return of president for course changes

Lula 2.0? Brazil’s maritime sector watches return of president for course changes
Eric Priante Martin 30 December 2022 https://www.tradewindsnews.com/shipyards/lula-2-0-brazil-s-maritime-sect...

As Luiz Inacio Lula da Silva prepares to take office on 1 January, minister promises to end privatisation of largest port and shipyards hope for support of old

Brazil will start the New Year with a new president who is also an old president — one who sought to spark a renaissance in the country’s shipyards and home-flag shipping industry.

That has the country’s maritime industry watching to see what course changes are ahead under the administration of Luiz Inacio Lula da Silva.

Even before the 1 January inauguration, the president-elect’s government in waiting has made it clear that maritime policy shifts are ahead.

Incoming port and airport minister Marcio Franca, a Brazilian Socialist Party leader, said he will put the brakes on privatisation of the port authority for Santos.

The effort to put the port, which is South America’s largest by container throughput, was started by the administration of current president Jair Bolsonaro, who lost to Lula in October, and is under review by a federal accounting board.

“The port authority will remain state-owned,” Franca told Brazilian daily newspaper Folha de Sao Paulo.

Franca, a former governor of the state that includes Santos, said the federal government will allow concessions covering certain areas of the port.

And he said officials will respect privatisations that have already been finalised, but those that have not been approved will face the scrutiny of the new government.

Santos Brasil chief executive Antonio Carlos Sepulveda told an investor event that his company supported the proposal of former infrastructure minister Tarcisio de Freitas to privatise the port.

Sepulveda, whose company is a major terminal operator at the port, said the plan was bold and viable. But by the 30 November Port and Maritime Equities day, he was already ruling it out.

“I think it was at the final stages and I think it was still advanced at the last round of negotiations, but I think this is in the past,” he said.

The executive said he believes part of the port authority can still be privatised, and he expects the industry to push for that.

Tarcisio, who is referred to in Brazil by his first name rather than his surname, won the election to take Franca’s former job as governor of Sao Paulo state and has pledged to continue to pursue the port privatisation.

Meanwhile, the Brazilian shipbuilding sector has hopes that Lula’s return to Alvorada Palace, as the president’s residence in Brasilia is known, will mark a return for his support for the industry.

In his prior presidency between 2003 and 2011, Lula sought to use Brazil’s oil boom to revive a shipbuilding industry that had once been a world leader, but some shipyards have since fallen into what a Brazilian maritime trade publication recently described as “stagnation”.

Ariovaldo Rocha, president of shipbuilders industry group Sinaval, said the sector depends on the government and hopes there will be continuity with Lula’s history of supporting the shipyard business.

“Without a doubt, we will work with this government to review the local content policy so that parts, equipment, etc, be used that are produced in Brazil, which has already demonstrated the ability to do so,” he told TradeWinds.