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Brazil’s Senate is against the privatization of Brazilian state-controlled utility giant Eletrobras in the current form proposed by the government, Senate President Davi Alcolumbre said on Friday.
The privatization bill for Centrais Eletricas Brasileiras—as Eletrobras is officially named—is opposed by 48 out of 81 Senators, Alcolumbre told reporters, as carried by Reuters.
Brazil has been considering for several years giving up state control over the utility, but the privatization efforts were accelerated under new right-wing President Jair Bolsonaro, who came to office at the beginning of this year.
In 2017, Brazil announced that it would put up for privatization 57 major state infrastructure assets, including selling some or all of its 51-percent stake in Eletrobras.
In early 2018, Eletrobras expected that the share sale part of its privatization could raise between US$3 billion and US$4 billion.
The Eletrobras share sale is expected to be the largest privatization in Brazil in the past 20 years as Bolsonaro pushes to cut the state’s control over the industry.
Eletrobras controls transmission lines and electric generating plants throughout Brazil, and owns power distribution companies that are now being sold. Eletrobras accounts for almost one third of Brazil’s power-generating capacity and almost one half of the nation’s high-voltage transmission network.
Earlier this year, Bolsonaro approved a plan for Eletrobras’s privatization, which entails selling new shares to private investors and thus reducing the Brazilian state’s stake in the utility.
Bento Albuquerque, Brazil’s Mines and Energy Minister, said in early November that Eletrobras would probably be privatized in the second half of next year.
But Bolsonaro’s plan has now hit a snag at the Senate, with Senate President Alcolumbre saying that the plan in its current form would not pass in the Senate and that the government needs to draft another plan for the privatization of Eletrobras.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.