Rio de Janeiro Needs R$42.5 Billion More for Infrastructure

By Jay Forte, Contributing Reporter

RIO DE JANEIRO, BRAZIL – The BNDES (Brazilian National Development Bank) released a study that says Rio de Janeiro, even after the 2016 Olympics, will need to invest R$42.5 billion within twelve years to overcome the urban transportation and infrastructure shortfalls. Across Brazil, the projection is a need for R$234 billion investments, or 4.8 percent of GDP, over the same time period.

The BNDES announced in April it would allocate approximately R$60 billion (around US$19.4 billion) from a total of R$170 billion (approximately US$55 billion) of disbursements planned for 2015 towards the infrastructure sector. The volume of disbursements for the sector, forty percent of the total made by the Bank, is similar to that seen in 2014.

At the time, Nelson Barbosa, Minister of Planning, Budget and Administration, said “There is a strong repressed demand for infrastructure investments in Brazil and we are working to transform this demand into concrete investments and projects.”

As O Globo reports, the authors of the new BNDES study do not prescribe the specific plan of the estimated works, only defining the lack of infrastructure in each city and estimate the need for investment. Deficiencies in fifteen metropolitan areas were documented with Rio listed with the second largest demand for resources, trailing only to São Paulo (R$83.5 billion).

In Rio de Janeiro, most of the money was identified for the expansion of the metro (subway) system. The bank estimates that R$35 billion (83 percent of the total) is needed to build 81.8 kilometers of lines, more than doubling the existing infrastructure.

The 81.8 km include both heavy and light metro railways, terminology used by BNDES to differentiate the capacity of modes (high and medium-high). Today, Rio has 42 km of heavy metro lines and 16 km more under construction, connecting the South Zone to Barra da Tijuca, in Zona Oeste (West Zone), and to be inaugurated next year.

Second on the investment needs list is the Light Rail Vehicle (VLT), with demand of R$5.8 billion in resources to build 83 kilometers of track. The BRT appears on the list with a smaller budget (R$1.3 billion for 34.3 km), together with the light train, which connects the suburbs to the urban center (and will need R$178 million for 1.2 km).