The president of the Brazilian Chamber of Deputies, Arthur Lira, criticized the proposal by the President of the Republic, Luiz Inácio Lula da Silva, to Cancel the privatization of Eletrobras, approved by Congress during the government of his predecessor, the former right-wing leader Jair Bolsonaro.
Eletrobras is the largest electricity company in Latin America, privatized during the Bolsonaro government.
According to Arthur Lira, the company was privatized because it did not have sufficient capital for investment.
“The decision (to privatize) was the right one,” he said.
The Speaker of the Chamber then invited Lula to try to understand him “Even if the government is progressive, Brazil it has a Conservative parliament with liberal ideals.
According to the Folha de Sao Paulo newspaper, “the market is also critical the attempted interference in Eletrobras and sees a risk due to the privatizations of the sector”.
Lula’s government has recently suffered two setbacks in Congress. First a project to regulate social networks (the so-called ‘Pl on fake news’) was withdrawn, then a proposal to revise the current legislation on basic sanitation was rejected.
The situation of Eletrobras
Eletrobras reported last week that it achieved net income of 406 million reais (about $81.2 million) in the first quarter, 85% less than in the same period of 2022.
The result was influenced by “facts derived from capitalization”, the company said in a statement to the market.
On these facts, the company that operates in the market of generation, transmission and marketing of electricityit referred to the “commissions and the monetary discounting of contributions to the funds envisaged in the new thirty-year concession contracts”.
In 2022, the year the company was privatized, Eletrobras achieved a net profit of 3,600 million reais (about $720 million at current exchange rates), 36.9 percent less than in 2021, the company reported on Monday. .
Eletrobras it is responsible for a third of the generation in Brazil it owns almost half of the country’s transmission lines, with a total extension of over 70,000 kilometers of power lines and an installed generation capacity of approximately 50,000 megawatts (MW).
The number of employees in September of this year was 10,476, which means 14% less than in 2021.
The Gthe government goes to court
On Friday, Lula’s government requested this Friday that the Federal Supreme Court (TSE) consider privatization “partially unconstitutional”. of Eletrobra.
The request to the Supreme Court was presented by the General Counsel of the Union, with the approval of the president, and calls into question the limit to 10% of the members in the voting or in the appointment of the Board of Directors.
With the model applied last year, during the privatization, the state, through the National Bank for Economic and Social Development (BNDES) and the BNDESPar fund, reduced the ordinary shares of the company from 62% to 40%.
“This rule has had the practical effect of indirectly expropriating the political powers of the Union” in society and has caused “grave damage to the public interest” by “violating the federal law of ownership of lenses,” said the AGU in a note.
The 10% limit of decision-making power for shareholders, established by the rules on privatizations in the Bolsonaro government prevents a conglomerate or group from taking full control, be it private or public.
Even with 40% of the share capital, the government wants the rule of proportion to apply regain control of the former state company.
Agencies
ap
Source: Clarin
Mary Ortiz is a seasoned journalist with a passion for world events. As a writer for News Rebeat, she brings a fresh perspective to the latest global happenings and provides in-depth coverage that offers a deeper understanding of the world around us.