Bolsonaro personally delivers Correios privatization bill to Brazil’s Chamber of Deputies

RIO DE JANEIRO, BRAZIL – In another move to show that the liberal agenda sponsored by Economy Minister Paulo Guedes is still standing, President Jair Bolsonaro visited the Chamber of Deputies to deliver the bill that paves the way for privatizing the Correios (Postal Service).

The bill, which  had been languishing at the Planalto since October last year when it was hand-delivered by Minister of Communications Fábio Faria, will enable the private sector to take over the state-owned company’s operations.

The state company has been in the government’s sights since August 2019, when it was included in the Investment Partnership Program (PPI) portfolio. In an interview with Estadão/Broadcast late last year, PPI secretary Martha Seillier said that in any privatization option taken by the government no city will be left without service. According to her, 95% of the population has access to the Correios services.

There are three options for privatization of Correios: sell the whole company, break it down by type of service, or split it by region. The model is not included in the project and is subject to further studies.

The Special Secretary for Privatization, Disinvestment and Markets of the Ministry of Economy, Diogo Mac Cord, also stressed that the globalization of services will be preserved. “With the efficiency gain, the Correios could become a major logistics and service supply vector in Latin America,” said the secretary.

Through this bill, the government intends to create a list of options to work with the privatization of Correios. Only after parallel studies currently underway are completed will a recommendation be made on the model. The Executive expects that, with this bill, there will be legal certainty to move forward with the privatization.

The bill was drafted after the government dismissed the plan to send a proposed constitutional amendment (PEC) on the subject, a tool that requires a larger quorum for approval and was seen as a given in past discussions.

The assessment is that the constitutional article according to which the federal government is responsible for “maintaining” the postal service does not compel it to be provided directly by the government. Accordingly, one of the bill’s goals is to regulate this section of the Constitution and thereby allow the private sector to take over the activities currently operated by Correios.

Source: InfoMoney

For the full picture, see our Brazil Tax Reform: Complete Guide.