The Brazilian government consented to privatize Rio de Janeiro’s water and sewage treatment on Friday, following quite a long while of vows to improve sewage treatment and tidy up the state’s contaminated Guanabara Bay.
Brazilian President Jair Bolsonaro went to the sale in Sau Paulo, where the treatment rights were sold for $4 billion, more than twofold the base cost. It was the greatest at any point water treatment rights deal in Brazil.
“Brazil is going to return to growth. We are going to get through both waves,” said Economy Minister Paulo Guedes, alluding to the flood in COVID cases that Brazil is confronting.
Sanitation company Aegea won the concession for two of the four blocks, presenting bids worth a combined 15.4 billion real ($2.8 billion). The company Igua was given a third block with a bid of 7.3 billion real.
The winning bidders have the goal of collecting and treating 90% of sewage by 2033.
Rio’s public water company Cedae had been criticized in recent years for its cloudy and smelly water, which sometimes tasted like earth.
Around 35 million of Brazil’s 212 million people do not have access to potable water, and 100 million are not connected to sewage infrastructure.
The auction was almost canceled after lawmakers who voted in favor argued the heavily indebted southeastern state could not auction Cedae, until it finalizes a new aid package from the federal government. But interim governor Claudio Castro, an ally of the President, issued a last-minute decree ordering the auction to go ahead.
Congress passed a law last June making it easier for private firms to participate in water and sanitation projects, aiming to bring potable water and sewage service to the full population by 2033.
According to Trata Brasil Institute, only 65% of sewage in the city of Rio is properly treated, leaving 35% to be improperly discharged. Rio had pledged in its bid to host the 2016 Olympics that it would treat 80% of its wastewater before the games began. However, it failed to deliver on the promise.