The New Year's Eve holiday ended in Brazil not with a bang, but with a combination of floods and transport chaos that exposed the cracks in the country's creaking infrastructure.
In heavy rain on one of the busiest travel days of the year, Rio de Janeiro's Santos Dumont Airport closed three times. Just 12 of its 332 flights left on time, and 119 were canceled. At the international Tom Jobim airport, 46 percent of flights were delayed.
"If New Year's Eve is in such chaos, imagine how it's going to be during the World Cup," Thiago Moreira, trying to get to Brasilia, told the Folha de Sao Paulo newspaper. Even the Brazilian Air Force posted the paper's story on its website.
As Brazil's economic might grows, and its population booms, the increasing sense of overload on its public works is becoming a cause for national concern -- especially as the country gears up to host the World Cup in 2014 and the Olympics two years later.
After noting that Brazil had just overtaken the U.K. as the world's sixth-biggest economic power, Eliane Cantanhede, a columnist for Folha de Sao Paulo, exclaimed: "What kind of power is this?"
The infrastructure is poor. The `little' power cuts are almost routine, the ports are full of bottlenecks, the highways are terrible, railways are virtually nonexistent.
New Year's Day brought the summer rains, and with them, concern that the landslides, floods and deaths that marred the country the past two Januarys would return. In 2011, about 900 people died in Rio de Janeiro state in devastating floods. Scores were killed the year before. For many of the 11 million Brazilians who live in favelas -- often shabbily built in risky areas -- summer rains mean fear.
In Minas Gerais state, 71 cities are now in a state of emergency and eight people have died as a result of flooding and landslides since October. In the city of Nova Friburgo, where 428 died in the disaster last year, 150 people abandoned their homes on Dec. 31 and found that some shelters were closed. Only 15 of 24 warning sirens sounded.
Exactly who or what is at fault for such problems is a divisive topic. Aloizio Mercadante, the minister for science and technology, blamed the flooding disasters on a changing climate, the difficulty of moving entire communities out of harm's way, and a shortage of geologists to map areas at risk. He sounded a dire warning on Dec. 16, amid news that 29,000 houses were threatened in Sao Paulo:
People will die this summer and the summers to come. We are not going to have a system capable of preventing victims.
Carta Capital magazine blamed increased militarization by the government of Rio de Janeiro state. In 2010, the state reduced spending on civil defense -- which includes managing floods and landslides -- by 10 percent as it increased police spending for its favela-pacification program by 36 percent. The floods came right after that.
"The cuts happened on the eve of the tragedy," the magazine said.
Then there's the federal government. Gleisi Hoffmann, the Cabinet's chief of staff, cut short her holidays to deal with the flooding crisis. But it soon emerged that much of the federal money budgeted for preventing disasters hadn't actually been distributed to states and municipalities.
The Estado de Sao Paulo newspaper noted that the government had delayed almost 50 billion reais ($27.3 billion) earmarked for infrastructure projects -- including for a bullet train between Sao Paulo and Rio, which was originally planned for the 2014 World Cup and is now scheduled for 2019. The newspaper said such delays occur all too often, and mentioned holdups on highway construction, hydroelectric projects and improvements on three crucial airports.
Just why delays are so common is difficult to pin down, but many Brazilians say the country’s cumbersome bureaucracy is an unfortunate legacy of its Portuguese colonizers. Incompetence, corruption and greed also play a part in many political decisions, and it wouldn't be unfair to say that a relaxed attitude to changing your mind makes up part of the Brazilian character.
Regardless of the reasons, “The fact is that in Brazil there is still a very long lag between the investment decision and its realization,” said Paulo Godoy, the president of the Brazilian Association of Infrastructure and Basic Industries.
In the business daily Valor Economico, Godoy said Brazil needs to invest more than 800 billion reais to improve infrastructure in the next five years, including on oil and gas, electricity, transportation and logistics, telecommunications, and sanitation.
Jorge Gerdau Johannpeter, the chairman of Brazilian steelmaker Gerdau SA, told Valor that on this score Brazil is lagging behind other emerging economies such as China, which spends 50 percent of its gross domestic product on fixed investments, compared with Brazil's 18 percent. He said:
This is a very low number, more than 30 percent short of what is needed. The state must invest more, because there are many deficiencies in health, education and logistics, while competition with the Asian countries will continue to increase.
The government has instituted a plan, known as Pac 2, to fund such projects. But, naturally, it's way behind schedule. And President Dilma Rousseff has show little appetite for new government spending. For now, residents of areas at risk of flooding, and frustrated passengers on yet another delayed flight, will just have to hope and pray.
(Dom Phillips is the Sao Paulo correspondent for World View. The opinions expressed are his own.)
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
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