Brazil’s Congress Passes Bill to Privatize Electric Utility

Brazil’s Congress passed a bill Monday paving the way to privatize the biggest electric utility in Latin America, state-controlled company Eletrobras, in a victory for far-right President Jair Bolsonaro’s privatization agenda. The bill, which sets up a share issue that will dilute the government’s stake in the company, passed the lower house by a vote of 258 to 136. Lawmakers must still vote on a series of amendments before sending it to Bolsonaro. It had already passed in the Senate. The legislation will reduce the government stake in Eletrobras from 51.82% to 45% via a share issue penciled in for early next year that the state estimates will raise around $5 billion (25 billion reais). The government will, however, retain a “golden share” in the company, giving it the final say on strategic matters. Created in 1962, Eletrobras is one of Brazil’s “big four” state-controlled firms, along with oil company Petrobras and banks Banco do Brazil and Caixa Economica Federal. Bolsonaro’s ultraliberal economy minister, Paulo Guedes, has said the privatization will save Brazilians up to 7.4% on electricity. 

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