Brazil:
Most Privatizations are Expected
During the Second Half of 1998
Source: ANSA
Sao Paulo, 29 January 1998. Planning Minister Antonio Kandir has said that most of the Brazilian privatizations will take place in the second half of 1998.
Kandir made the announcement after the National Council approved the last timetable for the sale of public enterprises.
According to the timetable, the Brazilian energy generation system will pass into the hands of private investors during the last half, not the first half, of the year as the Government had announced initially.
The four large federal energy systems responsible for 47 per cent of all the electricity generated in the country will be privatized, as well as the systems in the north east states of Manaus, Pernambuco, Alagoas and Boa Vista.
In addition to the electricity sector, the telecommunications companies will be up for auction, like areas two and three of the B cellular phone band (private), Telebras (divided into 12 companies) and Embratel.
Kandir calculated that the Government's income from the privatizations will amount to 32.8 billion dollars, 12 or 15 of which will correspond to foreign direct investment, which, according to the minister, will finance 60 per cent of the current account deficit, estimated at 30 billion dollars for 1998.
In the last six years, according to the National Economic and Social Development Bank (BNDES), Brazil earned 33.5 billion dollars with the privatization policy, while the imbalance in the country's current account (difference between what the Government spends and what it earns) in 1997 alone amounted to 31.2 billion dollars.
