A new ports law was approved by the Congress in Brazil this month, but has still to be authorized by Brazilian President Dilma Rousseff. The changes to the Brazilian ports law are to coincide with the plans to both expand and modernize Brazil’s congested ports as a way to attract private and foreign investors, as well as to encourage skilled foreign workers to migrate to the area. The new law will also make it more straightforward for Brazilian companies to employ much needed foreign workers, to breathe life back into a stagnated field and to stimulate economic growth in the sector.
Before the new law was passed, private terminals were not permitted on Brazilian ports, but that restriction has now been lifted. Not only that, private companies can now invest in state-owned ports, which was prohibited before this new legislation was approved. Other changes now allow private shipping companies to handle third-party goods at their own terminals, rather than just their own private goods. This is good news for foreign investors and foreign shipping companies who may want to make Brazilian ports a main terminus in their operations and can now transport a wider variety of goods in and out of the country.
According to an Associated Press article, the new Brazilian ports law is just one of many new legislative changes being proposed by the Brazilian government in a plan to invest R$54 billion in the ports sector. The government hopes that by investing in the sector, it will make it more efficient and allow Brazil’s ports to trade competitively within the import/export sector by lowering freight costs by up to 20%. Investment in port areas in Brazil will also modernize them in time for the influx of tourists that will arrive for the 2014 World Cup and the 2016 Olympic Games.
This new law couldn’t have come at a more opportune time. Brazil has been a prime producer and distributor of commodities over the last 10 to15 years, and this will continue to grow as Brazil takes advantage of its recent oil boom. Introducing more relaxed port laws in the country will not only allow a greater diversification of imported goods, but it will also permit Brazilian and foreign companies to export Brazilian commodities internationally and with much more freedom.
