BRAZIL – The Brazilian government launched a series of measures Wednesday to attract up to 133.000 billion reais (66 million) in private investment for development of new roads and railways, necessary to clear the bottlenecks in transport the country.
The measures include a plan to double the capacity of concessions to major highways and rail roads, said Paulo Passos, Minister of Transportation, during an event in Brasilia.
The government, through the state development bank BNDES, will also offer subsidized loans to investors who wish to participate in projects.
The measures are an effort of the government of President Dilma Rousseff, to modernize the country’s economy stagnated in the last year after showing an average growth rate above 4% for much of the last decade.
The government says that with the modernization of infrastructure, which considers improving roads and railways collapsed, can lower business costs and give greater efficiency to the economy in the coming years.
During the ceremony, Rousseff said that the measures would help Brazil, the largest country in Latin America, to be “richer, stronger, more modern and more competitive.”

The president added that such investments can be made “Brazil finally has an infrastructure compatible with its size.”
The government also expects the investment to revive the economy in the short term. Passos noted that the investment is expected to take place during the next five years.
“This is not an investment program to be diluted in the next 15 or 20 years,” he said.
The program provides grants to expand the old and overloaded system of roads and railways in Brazil. In addition to plans for the construction of highways, the government hopes to attract investment for up to 10,000 kilometers of rail track network in the country.
They envisaged in the coming weeks the Government announced similar projects for ports and airports.
Economists welcomed the measures, after saying for some time that Brazil had to unclog its outdated roads, ports, railways and air terminals if ever hoped to free the economy from the shackles that had held for so long.
Experts believe that compared with past efforts to encourage consumer spending as the solution to the stagnation of growth, infrastructure projects can generate long-term benefit of much greater.
“This package, if it materializes, would be a very positive effort to address the constraints on the potential long-term growth in Brazil,” wrote Nick Chamie, an analyst at RBC Dominion Securities in Toronto in a report released Wednesday.
The deteriorating infrastructure not only slows the movement of goods and services but raises the prices of everything from fuel storage to the cost of labor. That, in turn, exacerbates the historic Battle of Brazil against inflation and takes Brazilian companies competitiveness against foreign rivals.
When compared with China, where the government has invested in a fast and intensive infrastructure projects in Brazil vowed to continue its recent expansion materialized slowly.
And because of the bureaucracy, legal problems and costs that are out of control quickly, some of which never materialized.
As a result, the goods are delayed at least twice in the same distance in China and other markets more efficient, according to experts in logistics.