Paulo Godoy, president of Brazil's national infrastructure and basic industries association Abdib, presented a proposal to President Luiz Inácio Lula da Silva to form a private equity fund (FIP) to support private sector infrastructure projects, Abdib reported in a release.
"The fund would be used to finance short to medium-term initiatives of 12-18 months, as opposed to the longer term projects which are financed by financial institutions such as national development bank BNDES. Lula will discuss the initiative with the treasury department before making a decision," an Abdib spokesperson told BNamericas.
The fund would be used to improve financing conditions and guarantee continuity to infrastructure projects already underway, regardless of whether or not works have started, according to Godoy.
An Abdib survey shows that Brazil has roughly 100bn reais (US$44bn) invested in concession contracts or authorizations to carry out infrastructure projects. These initiatives are principally financed by BNDES, using long-term credit lines.
At the same time, short and medium-term financial operations are used to complement these resources, such as bonds, bridge loans and promissory notes, among others.
To counteract the current lack of liquidity, Abdib is suggesting the formation of an FIP with an initial value of 10bn reais, with the support of BNDES, federal banks Banco do Brasil and Caixa Econômica Federal (CEF), pension funds and other banking institutions.
Godoy believes the timeframe of 12-18 months is enough time to see improvements in the financial markets, the release said.
No comments:
Post a Comment