One Hundred Years of Useless Projects

SÃO PAULO – In addition to the privatization of the Santos Port Authority (SPA), the successor to the former São Paulo State Docks Company (Codesp), the federal government, through the Ministry of Infrastructure (Minfra), hopes to remove from the drawing board later this year in 2022 the project that envisages the expansion of the railway system providing access to the port, with the concession of the Internal Railway of the Port of Santos (FIPS) to private companies, which could be Rumo, VLI, and MRS, all of which have expressed interest in participating in the auction. The contract foresees an investment of R$ 891 million, with the expansion of the port’s handling capacity to 115 million tons per year, within a period of five to ten years.

Currently, the railways are managed through a concession to Portofer, a company controlled by Rumo. The contract with Portofer will expire in 2025, but according to the proposal, it should be terminated early to allow for a new concession, this time with an associative model, meaning the participation of all railway operators that access the port and will have to manage it jointly.

Today, given the port’s capacity estimated at 50 million tons per year, the operations of its internal railways are close to collapse. This is especially problematic because investments have been made in expanding railway networks in the interior of the country, which will consequently have greater capacity to transport goods to and from the Port of Santos.

Furthermore, in 2021, the port’s movement reached 47.3 million tons, and the collapse of port operations was avoided only because, at the beginning of 2020, with the outbreak of the coronavirus (COVID-19) epidemic and its consequences, there was a drop in corn harvests. Additionally, for this year, with the war between Russia and Ukraine and sanctions against the Russian government, there is a forecast of reduced supply of Russian fertilizers (potassium chloride and others) used in soybean and corn fields, which is expected to negatively impact crops. About 25% of Brazil’s fertilizer imports come from Russia.

The hope is that, regardless of the government that emerges from the elections in October, plans for the revitalization of the railway system providing access to the Port of Santos will not be postponed or thrown into the distant future, as has happened with so many other projects over nearly a century.

As is known, the first project for a dry connection between Santos and Guarujá, a tunnel excavated for the passage of an electric tram, dates back to 1927. Since then, four more projects have been prepared: in 1948, there was a proposal for the construction of a drawbridge that would allow the passage of ships, similar to the one over the Neva River in St. Petersburg, Russia, built in 1916. In 1970, a project was proposed for a bridge with helical access. Then, in 2011, another project was presented, envisioning the construction of a submerged tunnel, abandoned in early 2015. Now, studies are being conducted for the construction of an immersed tunnel between Santos and Guarujá as part of the Investment Partnerships Program (PPI), a project that is part of the port’s privatization plan. This is the fifth project. There must be hope.

It should also not be forgotten that, in 1967, a project was presented for the construction of a metropolitan airport in Guarujá, based on the Santos Air Base, and in 2000, a working group studied the feasibility of building a metropolitan airport in Praia Grande, but these studies never left the drawing board. In other words, many public resources were invested in these projects. Today, it would be impossible to calculate how much money has been wasted by the negligence of public officials over nearly a century of discussions and useless projects. However, it is hoped that, this time, the revitalization project for the Port of Santos railway system will succeed. It would be something at least.

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Liana Lourenço Martinelli, lawyer, postgraduate in Business Management and International Trade, is the manager of Environmental, Social, and Corporate Governance (ESG) at the Fiorde Group, composed of Fiorde International Logistics, FTA Transport and Warehouses, and Barter International Trade. Email: lianalourenco@fiorde.com.br. Website: fiorde.com.br.

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