BREAKING

Lula launches nationwide $348bln investments to 'return to growth'

By Al Mayadeen English
Source: Agencies
12 Aug 2023 00:27

The Brasilian President announced that the projects under this funding will remain committed to strict environmental guidelines as a "priority".

Brazilian President Luiz Inacio Lula da Silva holds a Brazilian flag while leaving a polling station in Sao Paolo during the latest presidential runoff elections which he won on Sunday, October 31, 2022 (AFP)

Brazilian President Luiz Inacio Lula da Silva announced on Friday that the country will be placed back on track to grow economically as he relaunched a $348 billion investment into a major nationwide infrastructure program.

The capital will be injected into the energy sector, road development and building, water and sewage accessibility, healthcare sector, education, and the internet. The projects will be carried out under the public-private Growth Acceleration Pact (PAC).

"Our country needs credibility, stability and predictability, and this program provides these three ingredients," Lula said as he presented the PAC in Rio de Janeiro.

"I am sure that with the new program, the country will return to growth and take the correct path," Lula added, announcing that "all the capacity of the state" will be mobilized.

"Today my government begins. Until now, what we have done was to repair what had been damaged."

During Lula's terms in 2007 and 2010, similar programs saw some success, yet financial setbacks put many projects on hold.

Around $265 billion are planned to be paid out during the President's current term, while US$83 billion thereafter.

Almost one-third of the investments will be funded jointly by the public and private sectors and one-fifth by state-owned firms, such as energy giant Petrobras.

But Brazil's leader confirmed that the projects will be regulated in accordance with his environmental policy principle, which he committed to during his election campaign and later put into action when he banned mining and mass tree-cutting in the Amazon forest, as well as empowering local indigenous communities living with the world's largest green landscape.

"We have a great opportunity to become the world's great sustainable power, and the PAC will help with this. More than 80 percent of the energy (needed for the planned work) is clean," he said.

The largest portion of the investment will go to the construction sector - around $125 billion - over half of which will be designated for social housing for the Minha Casa Minha Vida program.

Funding awaits now Congress' approval of the new "fiscal framework", legislation that caps spending and which was passed in 2016 to keep government spending within a reasonable financial capacity.