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State-Run Companies Have Cost the Union US$ 12 Billion in the Last Two Years

01/09/2018 - 11h08

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FLAVIA LIMA
FROM SÃO PAULO

According to a survey conducted by the Senate's Independent Fiscal Institution (IFI), the Federal Government directed R$ 40 billion (US$ 12.3 billion) in funds to state-run companies in the last two years. The survey took 149 companies into account.

Among these companies, 18 are financially dependent, while 131 are independent, meaning they have not required as much government support to maintain themselves.

According to the IFI, the revenues of the dependent companies in 2016 totalled R$ 16.8 billion (US$ 5.2 billion), 90% of which came from the Union.

According to Josué Pellegrini, an aide who works at the institution, the numbers in 2017 were not all that different.

Independent state-run companies received R$ 6 billion (US$ 1.85 billion) in 2016, and another R$ 2.4 billion (US$ 740 million) last year.

As far as the distribution of dividends to the Union go, the amounts in question were far inferior to the record amounts obtained in 2008 and 2015.

Many state-run companies, whether they are dependent or not, are in the red. The company in the worst financial state is Eletrobras. Back in 2016, it had a negative net worth of R$ 20.3 billion.

PERSPECTIVE

When peering into the universe of state-run companies it is important not to jump to conclusions, as it is very diverse and the financial situation the companies are in vary considerably.

The portfolio of public companies includes Valec, a dependent company that manages railroads and whose former directors misappropriated public funds, and it also includes Infraero: an independent state-run company that manages airports, but which received R$ 3.4 billion (US$ 1 billion) in federal contributions over the past two years.

At the same time, there are companies like Empraba, which does research on agriculture and cattle raising and has a reputation for excellence and innovation.

Translated by THOMAS MATHEWSON

Read the article in the original language

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