Brazil has the best environment for public-private partnerships in Latin America, says IDB
Chile and Uruguay are also highlights; report points out that the Brazilian market is one of the most active in the region
The Inter-American Development Bank (BID), in conjunction with Economist Impact, conducted a study across the Latin America and the Caribbean, which indicated Brazil as the best country in the region for public-private partnerships (PPPs), a model widely used in infrastructure projects.
Chile also stood out in the document, followed by Uruguay. Colombia and Peru complete the five best evaluated in the study, called Infrascope. PPPs are among the main government instruments to stimulate investments in infrastructure, which Brazil needs to double, according to a CNI study.
The survey is conducted every two years and, in this edition, included 26 countries. Indicators that measure the quality of the country’s regulation and institutions, financing conditions, sustainability, risk management and performance measurement are considered.
Based on the scores for these items, the countries’ business environments are classified as “mature”, “developed”, “emerging” and “nascent”. In the region, the study did not consider any of the markets as “mature”, but seven countries achieved the category of “developed” market.
Brazil and Chile are considered “developed” leaders, with the highest scores. Uruguay, Colombia, Peru, Panama and Costa Rica are “developed” with high performance, slightly below the first two.
Countries such as Mexico, El Salvador, Jamaica and Paraguay are included in the “emerging” category of markets for PPPs. The average “emerging” ones are Argentina, Ecuador and the Bahamas, and the “nascent” ones, Haiti, Bolivia, Belize and Suriname.
History of Brazil is highlighted
In the case of Brazil, the report pointed out that the country has one of the most active markets for public-private partnerships in the region and one of the oldest histories of private participation in the infrastructure sector.
“The Brazilian environment for PPPs has four main highlights: a well-equipped and funded agency, an efficient project selection and preparation process, attention to social and environmental sustainability during the preparation phase, and frequent performance and impact assessments”, points to the document.
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The report also highlights that the Investment Partnership Program (PPI), currently under the responsibility of the Ministry of Economy, manages projects in several phases and that the legal framework includes concern for sustainability measures, in addition to monitoring the quality of the services provided. .
Among Brazil’s main challenges in this area, the report also points out four main factors.
The first is to ensure the proper allocation of project risks between the public and private spheres. The second is to improve the ordering between different government agencies in the processes of project development, implementation and supervision.
The document also recommends reinforcing legal certainty in contracts and improving the assessment of environmental and social impacts after the completion of projects.
“In addition, the progress of the mentioned factors related to the legal framework and institutional coordination would bring more consistency in the Brazilian performance in terms of regulation and institutions”, emphasizes the project.
Source: O Globo Agency