Go-slow: Brazil’s road and rail improvements drag

Brazil's recently-announced R$133bn road and rail improvement programme will need to overcome a track record of chronic under performance to win investor trust. The news flow on projects to date is not helping.

The  Federal government's Sistema de Administração Financeira (Siafi) has revealed dismal performance in meeting road and rail targets this year. Based on data from the Institute of Applied Economic Research (IPEA), R$13.627 was supposed to be spent on roads this year but only 48.3% has actually been executed to date (with just over two months to go). Less than 27% of planned rail investments have been realised with some R$740m spent. This is the worst performance since former president Lula was in power. Waterways are in no better shape. Carlos Campos, infrastructure coordinator at IPEA, pointed to the low quality of engineering ideas in projects, difficulties in expropriating property and licensing. Brazil has a long way to go if it is to engender investor confidence.

Valor carries a full article on the subject (in Portuguese):
http://www.valor.com.br/brasil/2879368/uniao-executa-so-50-do-investimento-em-rodovias#ixzz2AIzAAief.

 

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I've been researching and writing on Brazilian financial markets, industry and economy since 2006 for a wide range of specialist media, consultancies and investors. Before that I spent over 10 years in London and New York writing for and editing magazines and journals dedicated to finance, investment and economics in developing markets, mostly for the Euromoney Institutional Investor group and Thomson Financial. Areas of coverage Below are samples of areas that I cover and some of the common themes that I investigate. Capital markets BM&FBovespa markets *capital raising trends: via equities (IPOs and secondary issuance), debt and loans *the asset management industry: legislation and coverage of the key hedge, pension and investment funds * corporate governance: how the regulator is seeking to strengthen best practice and limitations * debt markets: the nascent corporate markets, attempts to boost liquidity and new insturments. * private equity market: why this market has been so successful, who’s involved. *electronic, high frequency trading and alternative trading platforms: what does the future hold? Banking *credit: the growth of consumer and business credit and competition between banks and models *Public versus private: the role and market share of public and private sector banks and the politicization of the industry * internationalization: which Brazilian banks are expanding overseas and where * investment banking: the growth of the domestic market and who’s winning which mandates *regional banks and development banks: what role they play in the industry and how they compete Mining *licensing: the complex process of obtaining environmental, water, land and operating licenses at a state and federal level. * capacity: the feasibility and sustainability of capacity increases * financing: how miners are raising finance in Brazil and abroad *competition: the interplay Vale, MMX and junior miners *logistics: rail, road and port connections Oil and gas: the fund raising issues related to the massive of pre-salt (link) Multilatinas: Who are they and how and where they are expanding Meatpacking: Are debt burdens sustainable, what are the different business models for areas such as branding and distrbution Agriculture: How are farms consolidating, what are environmental risks, how can foreign investors be involved. IT and software: Can Brazil take on India and build a viable long-term IT industry? For more information on clients and work, please see the media and consultancy sections.
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