RIO DE JANEIRO, BRAZIL – The Brazilian Chamber of Deputies approved a bill that allows the privatization of Correios (Brazil Postal Service), responsible for mail deliveries in the country and considered one of the world’s largest companies in the delivery sector.
The approval, by 286 votes in favor and 173 against, authorizes the sale of the state-owned company to private initiative through an auction and represents a victory for the government of President Jair Bolsonaro.
The privatization of the Brazilian Post and Telegraph Company is included in the list of 115 assets to be sold or offered in concession by the Ministry of Economy, which estimates that the delivery of such state-owned companies to private hands may generate investments for R$367 (US$70.442) billion.
The proposal authorizing the operation of all postal services by private initiative was submitted by the Government to the Lower House last February and now depends on the Senate’s approval and presidential sanction.
The privatization of Correios and other important state-owned companies, such as the electricity company Eletrobras, is part of an ambitious privatization and concession agenda promoted by Bolsonaro’s economic team. He hopes to reduce the size of the State.
With the endorsement of Congress, the government plans to hold the auction of Correos as early as the first half of 2022.
To justify the sale of the company, which has almost 100,000 employees, the Executive claims that there is uncertainty regarding its self-sufficiency and capacity for future investments, despite its history of generating profits.
Thursday’s vote generated criticism from opposition deputies, who rejected the urgency of the session and claimed that the bill was “unconstitutional”. For that reason, they tried to interrupt the plenary session without success.
The Association of Postal Professionals (Adcap) expressed the same opinion after learning the deputies’ decision, stating that the measure was processed in Congress “ignoring fundamental issues”.
“The bill was processed ignoring fundamental issues, such as the fact that the Attorney General’s Office itself has already recognized that an eventual privatization of the Post Office could not be done without a constitutional change,” said the Association in a statement.
The constitutionality of the sale is already under analysis by the Brazilian Supreme Court, in an action filed by Adcap and in which the Prosecutor’s Office has already expressed its opposition to the full privatization of the state-owned company.