Brazil infrastructure investments will fall far short
Tuesday, June 8, 2021
Significance
Public investment in Brazilian infrastructure has declined in recent years, given the government’s fiscal constraints. President Jair Bolsonaro’s administration favours privatisations and concession plans, but low investment levels have generated fragilities that may affect both short- and long-term competitiveness.
Impacts
- Water shortages will cause energy price increases due to the use of thermal power plants and energy imports.
- Bolsonaro’s continued criticism of China will raise doubts about forthcoming 5G auctions.
- Lack of public infrastructure investment will make infrastructure projects less attractive to private investors.