Brazil is taking action to appeal to more foreign investors in an effort to ramp up investments in the country’s infrastructure, officials told BNamericas.
International investors are integral to boosting Brazil’s infrastructure, according to the news source, given the country would need to invest around $110 brazillion a year until 2040 in order to end the infrastructure investment shortfall.
A special commission is evaluating measures to update public-private partnerships and concession models, with one of the main priorities of the project being to reduce foreign exchange risks for investors, according to lawmaker Arnaldo Jardim.
The exchange rate is considered to be one of the biggest risks for global investors in regard to P3’s and concessions
“For international investors, the exchange rate variation is a key element, mitigating risks on this front is crucial and likely to attract more international investors for Brazilian infrastructure projects, especially in the current scenario where in most parts of the world there are negative interest rates for investors and they are keen to find new opportunities,” said Pablo Sorj, a lawyer specializing in infrastructure at Mattos Filho, Veiga Filho, Jr Quiroga.
Officials are also looking to change regulations to bolster legal security and reduce bureaucracy for investors. A proposal to eliminate the possibility of infrastructure concessionaires filing for bankruptcy protection is currently being drafted and will likely be voted on in November.
