Rodrigo Vilaça London, September 26, 2012 C.E.O. of ANTF
Railway Mission - UK
THE EVOLUTION OF THE BRAZILIAN RAILWAY SECTOR IN THE LAST 15 YEARS: Achievements, Advances and Challenges
National Association of Rail Carriers www.antf.org.br ANTF Associates
South,,est,ot West, North aadnd Pauli sta Raaoadsilroads www.all-logistica.com
Railroads of EFVM and EFC Center-West Railroad North Leg Railroad www.vale.com www.fcasa.com.br
Northeast Railroad Tereza Cristina Railroad Southeast Railroad www.tlsa.com.br www.ftc.com.br www.mrs.com.br Railways Transport Brazil into the Future with Integration and Development
THE EVOLUTION OF THE BRAZILIAN RAILWAY SECTOR IN THE LAST 15 YEARS: AchievementsAchievements,, Advancesand Challenges
1. Railway Concession in Brazil 2. Railway Concessions --ResultsResults 3. Challenges in Developing the Sector 4. Federal Government Plans and Programs Railways Transport Brazil into the Future with Integration and Development
THE EVOLUTION OF THE BRAZILIAN RAILWAY SECTOR IN THE LAST 15 YEARS: AchievementsAchievements,, Advancesand Challenges
Railway Concession in Brazil
1 Railway Concession in Brazil
Institutional Evolution 1. Government concessions for the construction of the first railroadsrailroads,, at the end o f Evolution of the XIX century,century, financed primarily by private British capital; 2. The second cycleof was RailRail defined Transport by the process of railway nationalization,nationalization ending wihith the fdifounding of RFFSATransport in 1957 ; in 3. TheDenationalization of the Railway Transportin BrazilSector, Sector with the concession of networks to RFFSA, during the 1990´s. Brazil - -CyclesCycles: : In the decade Neoliberal policies led to the reform of the Brazilian Sate, causingdecade 3 structural of transformations: of 1990: 1. Elimination1990: of certain restrictions on foreign capital; 2. Reduction of state-controlled monopoly, allowing for a concessionof public services to private initative – program of denationalization; and 3. Privatizations (Law n.º 9.941/97). Railway Concession in Brazil
National Denationalization Denationalization Program . Law n.º 8.031, of 04/12/90: established the PND divided into two departments • National DenationalizationProgram-Council - CND, decision-making body; and • Brazilian Development Bank - BNDES-“PND”:“PND”:, in a managing role for the National Privatization Fund -FND. - FND.
. Decree n.º 473, of 03/10/92: Railway transport begins to be a part of PND by the inclusion of RFFSA (Brazilian Railways Company), which has as its main goals:
• ease the the state state • improve the ´s burdenburden; the allocation • raise operatingallocation of; operating efficiency • promote the of funds efficiency;funds; the development ; • improve the development of; the quality quality of of thethe transport of servicesservices. transport market . market; ; Railway Concession in Brazil
National Denationalization Denationalization Program . The State sought new ways to provide public services: Transfer services Program – Dedicateservicesitself to to regulation and supervision, by way of the Regulating Agencies. to–“PND”: private“PND”: initiative initiative; . The State retained the responsibility; to : Define priorities, standards for se Regulate and inspect assets which remain in the power of the State.
rvice quality and ensure affordable fees; RFFSA Networks: lease contracts for operational State assets; CVRD Networks: Concession Contracts for the operation of freight-based railway transport, linked to passengers, having their own operational goods;
Rail Networks PlannedConcessionin the Contracts1980´ fors: Concessionthe operationContracts of railway transportationfor the construction of cargoand andoperation of railway transport services (North-South, Ferronorte and Ferroeste). Railway Concession in Brazil
Networks of of RFFSA RFFSA Privatization Privatization
Source: Ministry of Transportation Lecture - 2000. Railway Concession in Brazil
Other Networks Networks from from the the Period Period of of RFFSA RFFSA Privatization Trecho da FERROVIA NORTE-SUL Data de Subconcessão para Privatization exploração: 03.10.07 FNS - Ferrovia Norte Sul S.A. Extensão: 720 km
Construído e em operação = 226 km
Extensão: projetada = 4.548 km construída = 512 km
Source: Lecture from the Ministry of Transportation – 2000 (Updated). Railway Concession in Brazil
Railway Networks granted = 28,366 km In operation = 22 822,822 km km granted to Underused or (*) to private initiative or withoutwithout freight freight traffic initiative traffic = = 5,544 km
Transnordestina Logistics EFVM- Vitória to Minas Railway EFC - Carajás Railway
FCA - Center – Atllantic Railway ALL - Latin America Logistics São Paulo area ALL - Latin America Logistics Northern Network ALL - Latin America Logistics Malha Oeste ALL - Latin America Logistics Malha Sul FTC - Tereza Cristina Railway MRS Logistics Northern Stretch of North-South Railroad
Privatization Process: 1996 to 1999 11 Networks granted to private initiative Railways Transport Brazil into the Future with Integration and Development
THE EVOLUTION OF THE BRAZILIAN RAILWAY SECTOR IN THE LAST 15 YEARS: AchievementsAchievements,, Advancesand Challenges
Railway Concessions --ResultsResults
2 Railway Concessions - Results
Meeting the the PND hfit ihhdtiiitbli... t tifi iiti fti h hi Th d t e processPND of pr objectiveivatization has had strong positive impact on public finances: objective: Savings to Public Coffers 1994 - 1997 : Easing the State´s burden, generating public1996 benefits... - 1998
Losses accumulated from RFFSA R$ 300 million per year Amount calculated from the (annual deficit of RFFSA operation) auctions of the Defunct RFFSA R$ 2.2 Billion R$ 1.76 Billlion
... After granting rail transport services to
1996 - 2010 2011 Forecast 2012 Concession Payment and Concession and Leasing Leasing Installments: Payments : = R$ 5.52 Billion in R$ 600.0 Million + Concessions and Leases R$ 4.94 Billion R$ 578.8 Million PrivateConcessions Initiative the and LeasesState began to collect:
1997 - 2010 2011 Collection from Taxes, Forecast 2012 Collection from Taxes, = R$ 15.091 Billion in Concessions and Leases and + Concessions and Leases R$ 1.800 Billion CIDE: R$ 13 .52 Billlion and CIDE : R$ 1.58 Concessions, Leases, Taxes Billion and CIDE Taxes, Concessions, Leases and CIDE Railway Concessions - Results
Meeting the the PND ...R$ 30.3 billionPNDin objectiveinvestments toward the existingnetwork, in addition to what was objective: earned between 1997 and 2012, without counting investments for the construction of the 1997 - 2011 existing network . : Improvement in the allocation of resources has been made... 5.300 Total for State 4.739 Investments in Existing Networks granted to Private Initiative 143 R$ 1. 39 billion (million Brazilian reais) 4.398 225 3.053 1997 – 1st Sem. 2012 3.158 112 2.737 Total for Concessionaires 44 2. 622 140 2.293 123 R$ 30.33 billion 4.596 1.966 72 4.173 8 1.748 2.941 1st Semester 2012 1.124 3.114 2.597 Totaotal f or Concess i on air es 35 2.499 R$ 1.748 billion 824 2.221 58 724 1.958 11.2% 673 583 56 growth in relation to 574 56 that projectedof the 1st revenuesemester 45 1.089 499 Achdhieved 33 f % of 162 113 for 2012. 766 668 538 617 412 386 State Investment Concessionaire Investment 2006 1997 1998 1999 2000 2001 2002 2003 2004 2005 2007 2008 2009 2010 2011 2012 Notes: 1) 1997 takes into account 1996 investments; 2) Other values are up to date. Forecast for Concessionaire Sources: Ministry of Transportation, DNIT and ANTF Associates. Invesments in 2012 Railway Concessions - Results
Meeting the the PND ... InvestmentsPNDin construction objective to expand railways. objective: Railway Projects Currently Being Executed by Private Initiative : Promoting the development of the transport market...Estimated Length of Concessionaire Expansion of Rail Network Amount Construction (Billions of R$) (Km) ALL – North Network Alto Araguia Stretch - Rondonópolis/MT from Ferronorte ((contractualcontractual obligationobligation)) 0.780 260
TLSA Transnordestina Railroad (renovation of 550 km) ((contractualcontractual rightright)) 25% from State funds 5.300 1.728
FCA Variante Coastal Railroad South/ES ((contractualcontractual rightright)) 2.030 165 Total 8. 210 2. 153 Source: ANTF Associates and Balance of the 1st year of PAC 2 - March and July/12.
Alto Araguaia – Rondonópolis Stretch Salgueiro - Missão Velha Stretch those of 2011, as well of obtaining 5.5%
of the Annual Average Growth Rate (CAGR). Railway Concessions - Results
Meeting the the PND Private investement investementPND stimulated objectivestimulated an increasean increase of of 112% in in rail rail transport transport , comparing the the results results of 1997 of 1997 with with objective: Railway: Production Operational(Billions TKU) efficiency has increased... 320.0 1997 - 2011 111.7% 290.5 Freight in General 278.5 Growth of 140.5% 270.7 257.4 243.4 232.3 63.4 Iron Ores and Mineral 63.9 Coal 221.2 49.9 64,. 58.3 Growth of 104.9% 202.5 181.5 48.6 56.1 161.8 167.7 227.1 153.9 141.6 141.5 44.4 206.7 1t1st StSemester 2012 137.2 138.9 42.5 47.4 207.5 213.5 40.2 185.2 27 31.7 32.2 35.7 141.6 bilhões of TKU 183.6 Growth of 165.1 155.1 of the 1st1.5% Sem. 2011. 118,. 121.7 125.3 136.1 in face 110.2 10.,8 106.7 Has reached 44% of that which was forecasted for 2012.
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Note: TKU = Ton of Useful Km Transported Concessionaire Production CAGR: Compound Annual Growth Rate Forecast for 2012 Source: ANTT and ANTF Associates higher than the growth of Brazilian GDP (54%).
Railway Concessions - Results
Meeting the the PND it fC tib 2011 th oun d ti it fting the numPNDbers Objective of 2011, productivity of ra 111il fi httf h re t 7%ight transport has grown 111.7%, 2ti2 times Objective: : Comparative Analysis of Rail FreightOperational Transport Efficiency x GDP has increased... 1997 - 2011
GDP Increase of 54.0%
TKU Increase of 111.7%
2010 - 2011
Rate GDP Increase of 2.7 %
TKU Increase of 4.31%
Note: Rate base 100.00 in 1997. Sources: ANTF and IBGE of 1997 with those of 2011.
Railway Concessions - Results
Meeting the 1997 - 2011 the PND Growth of General Freight The movementPND of of freight freightObjective by railwaysby railways has grown has grown 87 6% 87.6%, comparing the the figures figures 76.2% Objective: : Iron Ores and Mineral Movement of Freight TransportedOperational efficiencyby Railways has increased... Coal (()Million TKU) 522.0 Growth of 87.6% 87.6 % 475.1 470.1 2010 - 2011 Total of Movement 450.5 445.2 111. 1 125 Crescimento de de 12%1,2% 395.5 General Freight 404.2 112 106.9 Drop of 10.9%. 386.0 368.4 100.6 99.5 Iron Ores and 336.4 364.0 315.8 117.4 Mineral Coal 288.1 291.6 101.8 338.5 345.1 230.6 Growth of 5.5%. 99.4 338.3 259.3 256.0 98.0 253.3 91.7 296.0 80.9 303.6 1st Semester 2012 73.8 72.9 67.2 266.5 268,. 230.6 milllions of TU
207.2 217.8 237.0 Drop of 199.9 186.1 185.5 183.1 to the2.6% 1st Sem. 2011. in relation Has reached 44% of 2009 2011 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2010 2012 forecastedthat whichfor 2012. was Nota: TU = Useful Tons Source: ANTT and ANTF Associates Freight Movement Forecast for 2012 Railway Concessions - Results
Meeting the the PND ThThe ra iil way PNDis an essenobjectiveti lal modde of tttransport for making several ittimportant nati llonally proddduced export goods feasibleobjective: Variation of Products: promoting Transported the development by Rail of the -1997 transport to market...2011 (Variation in %)
Minerals/mineral coal 91.4%
Agrobusiness 277.2%
Diverse Products (Petroleum and alcohol products / Raw -5.1% materials for Civil Construction, cement among others)
Source: ANTT and ANTF Associates Railway Concessions - Results
Meeting the the PND The quantity ofPND containers objective transported in 2011 increased by to that achieved in objective:2010. : 1st Semester 2012 QuantityPromoting of Containers the development of the transport market... (’)(TEU’s) 308.000 89.036 of TEU’s Drop of 287.458 15.0% 272.808 to the 1st Sem. 2011. 265.349 in relation 232.424 Has reached 29% of that 220.050 23.7% forecasted for 2012. 205.371 189.49 in relation 159.184 135.768 89.036 106.699 99.053 78.777 59.805
3.459 10.131
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: ANTF Associates Forecast of quantity of Containers transported in 2012.
Intermodal Transport on railways has grown
privatization began until 2011.
more than 82 times
since the Railway Concessions - Results
Meeting the the PND PND objective ... Railroad Concessionaireobjective:s generated a growth of 180.8% in direct and indirec t jobs,comparing 1997 to 2012, without counting jobs generated by the National Railway Industry : Improvements in the allocation of resources, generating social benefits... Direct and Indirect Jobs in the Existing Network 46.797
41.455 37.837 38.595 36.788 44.00 33.254 0 30.508 30.227 27.659
21.085 20.482 20.352 2.215 20.190 16.662
14.375
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: ANTT and ANTF Associates Forecast of direct and indirect jobs resulting from concessionaires in 2012
As to the expansion of the railway network, ANTF Associates have generated more than 11,350 jobsin the construction of the Nova Transnordestina (TLSA) and Alto Araguaia Stretches- Rondonópolis (ALL). Railway Concessions - Results
Meeting the the PND Management andPND investments objective made by pr accident rate, comparinobjective:g thos e occurred i n 1997 to those in 2012. : ImprovementAccident Rate in the quality of services, providing safety... (accidents per million train-kilometers) ) - 81.6% ivate initiative has made possible a 75.5 69.3 64.9 53.1 39.4 35.5 33.6 30.4 32.9 decrease of 81.6% in the 14.7 15.6 16.1 14.4 14.6 14.2 13.9
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Sources: ANTT e ANTF Associates.
International References: Between 8 and 13 accident s per milli on train-kilometers Railway Concessions - Results
Meeting the the PND PND objective Bifuel Train - Vale Railway transportobjective: is ecologically correct... : Improvement in the quality of services... Energetic Efficiency Rating (Liters of diesel per thousand TKU) 5.31 5.12 5.08 5.04 4904.90 - 21. 9% 4.79 Expansion of locomotives moved by 4.62 4.55 biodiesel
4.41 2006 - 2011 4.27 4.24 4.29 4.15 4.1 8.8% Decrease
1999 - 2011 21. 8% Decrease 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: ANTF Associates Forecast of Energetic Efficiency in 2012.
In 1999, 5.31 liters of diesel were necessary for the tttitransportation of a thousan d TKU (ton per useflful k)km). In 2011, consumption has gone down to 4.15 liters of diesel per thousand TKU, which is equivalent to a reduction of 337 million liters of diesel to serve 290.48 Billion TKU in 2011. Railway Concessions - Results
Meeting the the PND The fleet ofo roogPNDlling sso objectivetock ono the netwoosrks has evoodlved, ggoro gwing 133%1.2% in the ppoderiod ofo 199 o7 to 2011, in addition to theobjective: quality and new tec 1997 : Improvement2011 in the quality of services, expanding fleet...
1,154 locomotives 3,045 locomotives hnologies acquired by the Concessionaires 43,816 wagons 100,924 wagons
Source: ANTT and ANTF Associates Forecast of rolling stock acquisitions (2012 to 2020): Locomotives= 2,000 units Wagon = 40,000 units Tracks = 1.5 million tons
Average age of the Wagon Fleet: 1990 = 42 years 2010 = 25 years 2020 Forecast = 18 years
Obs.: Service life is 30 to 35 years. Railway Concessions - Results
Railway Concessionaires continue to meet the challenge of raising production with the infrastructure that was granted In observance of contractual responsibilities, funds have been allocated according to priority criteria, particularly in:
Improvement of the permanent track in granted networks, focusing on safety issues and transit time; Acquisition of Rolling Stock – locomotives and wagons -, as well as recovery of scrapped fleet inherited from the concession process; Gradual introduction of new technologies and systems of traffic control, with the aim of increasing productivity, security and reliability of operations, as well as conservation of the environment; Establishment of partnerships with clients and other operators, seeking markets with greater added value; Business training and professional development, installing rail operator courses together with other organizations, in addition to trainee programs; Socially responsible actions such as educational, preventive and awareness-building campaigns in the communities neighboring railways. Railways Transport Brazil into the Future with Integration and Development
THE EVOLUTION OF THE BRAZILIAN RAILWAY SECTOR IN THE LAST 15 YEARS: AchievementsAchievements,, Advancesand Challenges
Challenges in Developing the Sector
3 Challenges in Developing the Railway Sector
Strategic Agenda ANTF and AgendaAssociates forhave been following this agenda since Brazil on Track II in 2006, consisting of 12 structural andInstitutional systemic checkpoints for developing the future of railways in Brazil. for the the Rail Rail Freight FreightInfrastructur Transporte RemovalTransportof Bottlenecks Sector Expansion of the RailSector: Network : Intermodality Sustainability Regulation Safety Environment Partners of the Defunct Strategic Technology RFFSA Railway Agenda People (DNIT, ANTT, SPU, IPHAN and others)
FiscalFiscal- -TributaryTributary Taxation Service providers Competitiveness Challenges in Developing the Railway Sector
STRATEGIC RAILWAY AGENDAAGENDA-
Brazil´s eco eco o c gn o aso t mi b ougc g t pro essuwth e upohas t e ogbr stoug cs asth uctut pressu e, asc beer pe o g upon the logistics infrastructure, which has been improving its performance but still presents low availability...
Brazil has improved logistic - competitiveness but ... and continuesInfrastructure to present low logistics availability when compared to other countries unsustainably... # Brazil's position in the World Ways (km) per 1000km2 Bank ranking [2008] Logistics Performance 61 Area Paved 2 highways Railroads Pipelines Waterways 45 Million km 41 Brazil 8.525.0 3.5 2.3 1.6
China 9,3 169.0 8.3 6.2 11.8 2007 2010 2012 BRIC India 3.0 528.0 21.3 7.7 4.9 Infrastructure 49 46 37 Russia 17.0 44.0 5.1 14.5 6.0
USA 9.1 460.0 24.7 86.6 4.5
2007 2010 2012 Canada 9.046.0 5.1 10.8 0.1
Source: World Bank; ILOS 2008 Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA – Expansion of translates into a great need for investment s, with applications by the Concessionaires. of thethe Rail Rail Network NorteNorte--SulSul Investments contemplated Network– Infrastructure and connection points: R$ millions Belémand Intermodality▪ EF Carajás in Açailandia Intermodality: 1 ▪ FIOL in Figueirópolis North South 6.520 Boqueirão da ▪ FICO in Uruaçu Açailândia ▪ FCA: in Anápolis FIOL2 Esperança Carajás ...is a series of new mapped projects, which 6.000 ▪ ALL in Panorama EF Carajás Figueirópolis 6.000
FICO3 Ilhéus Uruaçu 4.100 FICO Anápolis FIOL Connection Point:Point: ALL Connection Ipatinga ▪ North South in Figueiópolis 3.616 PointPoint:: Porto MRS ▪ North South in Murtinho Victoria 2.271 Uruaçu Panorama Rio de Janeiro Prolong. ▪ FCA i n South in Ipatinga VALEC North- 1.600 Current concessions 4 Norte Sul EF Carajás South 6 912 Oeste Leste - FIOL FCA FCA Centro Oeste - FICO MRS Prolong. Sul ALL na Norte Sul TtlTotal Nota: R$ 29.4 bi. 1 Project stretch Açailândia/MA – Palmas/TO and Palmas/To – Estrela d’Oeste/SP 4 Project stretch Panorama/SP - Dourados/MS 2 Project stretch Ilhéus/BA – Figueirópolis/TO 5 Construction underway 3 Project stretch Uruaçú/GO - Lucas do Rio Verde/MT 6 Investments necessary for eliminating bottlenecks - 2010 Source: ANTF; Annual Railway Magazine – 2011; [Source of map] Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA –
Expansion of
. I Brasil nosof Trilhos thethe Rail ((Brazil Event in “CommemorationRail of 150 Network Years of – Railways in Brazil”, taking the Network andInfrastructure first steps in talks between Government and Private Initiative on Perspectives for RailwaysBrazil on in Braziland. Intermodality on RailsRails) Intermodality: ) - 2004:2004: . II Brasil nos Trilhos - Primary : ANTF action at the Federal level... theme “Current and Future Scenarios for Railways”, presenting this Strategic ANTF Agenda for the- 2006:2006: development of the sector in the country.
. III Brasil nos Trilhos - Debate on ”Railways Treading the Way in the 21st Century”, seeking mulilateral solutions. - 2008:2008:
. VI Brasil nos Trilhos - DbDebate on “The Importance of Railways for the Future of the Country”. -2010:2010: Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA – Eliminating Bottlenecks: ANTF action at the Federal level, in addition to the regional ppparticipatiion of Associates . Chamber of ANTF event held in December of 2005 initiating talks for the joining of forces amongof Deputies Legislative and Executive– Infrastructure Brances and the Private Initiative, to eliminate bottlenecks in the network. Deputies of of BrazilBrazil: :
. PROSEFER – Support and collaboration for the Board of Railway Infrastructure – DIF of theNational Department of Infrastructure of Transportation of Brazil -DNITfor the study of–NationalNational this program Rail (bid in 2008 and concluded in 2011), which introduces necessary interventions in critical areas of main corridors to eliminate conflicts between communities and Rail Safety operation. Safety Program Program: :
. PNLT – Contributions in the development of this–National planNational from Plan the Ministry of Transportation, to support the Federal Government in its Multi-annual Plans, as well in the PAC´s transport infrastructure projects. Plan for for Logistics Logistics and and Transportation Transportation:
: Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA-
Environment: ANTF and Associates acting together with the Executive Branch... - Sustainability . 1st and and 2nd Licensing2nd for StagesRailway Stages of ]Interfacefor amongRailwayA UndertakingsNTF, IBAMA, Ministry of Transportation and CNT to make social and of thethe Seminar economic developmentSeminar and the Discussing demands of the production process compatible with socio- environmental issues:Undertakings: Discussing the : DbtDebate on reltlevant themes reltdltheated Processto the itlltiinstallation an d operation o f small and large scale railway undertakingsundertakings;; Process of Technical discussions specifically on environmentalof ImprovingImprovinglicensing Envrironmentalprojects – sharing of experiences – for the betterment of standardization documents Envrironmental Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA-
TechnologyTechnology: ANTF and Associates action, gaining ground on the use of cutting edge technology in rail freight transport... : . Standardization and - Ferroviário CB06/ABNT) Sustainability . ANATEL (Nationaland Telecommunications Normatization Agency ) regulation on Normatization in Radiofrequencies on Channeling . Cooperation towards ChannelingLocomotive and Remote Control (Locotrol) - in the Metro Vale Rubber Floor for Level Crossings - MRSMetro- and Terms towards technological -RailRail Committee Terms of Committee CB06/ABNT (Comitê Metro technological development of UsageUsage for CB06/ABNT (Comitê Metro- for development
-
Substition of wood for recycled plastic in wagon - FTC Track Information System (SIV) - ALL Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA- People: ANTF e Associate action in the training of professionals (MhiitMachinist; TffiTraffic CtllController; Mechanical and Electrical Technician; Track Maintanence; Wagon Maintanence; Track Operator, Technician and Supervisor) ... - The associates are workinggp inSustainability partnershi p p to meet the growing demand of the 2nd generation of railways:
. Technological innovation triggerschanges in the professionalprofessional´´ss profileprofile;; . Inclusion ofsubjects relevant to railways in the curriculum of professional training centers;; . Partnerships with educational institutions ((BrazilBrazil):): Fundação Dom Cabral/MG; PUC/ MG; IME/ RJ; COPPEAD/ UFRJ; SENAI ((NationalNational and Regional); CEFETES/ MG; CEPEFER; UFJF/ MG. Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA- T TtiTaxation: ANTF action for ththe FdFedera l l GtGovernment tto applly measures for fiforeign tdtrade, idindus ttry and technology policies... REPORTREPORT:Railway Structure,Proposing with aTaxation the aim- of:Fiscal Regime and as an Incentive for the Modernization and Expansion of : and Tributary . Stimulating investments towards the modernization Tributary and expansion of Brazilian railwaysrailways, through the sale of machinery, equipment and other goods, in the domestic or foreign market, when acquired or imported by Concessionaires for the exclusive use of railways, suspending:
IPI (Tax on IdIndust tilidrialized GdGoods) In providing railway transport Importation Taxes services the following numbers are directly applied: PIS/ COFINS = PIS (Social Integration Program tax) 9.25% and ICMS (which varies and COFINS Social Contribution on Revenues tax) by state) in the range of 9%, 12%, 18% or 19%. ICMS tax DIESEL: Proposal for the creation of a special category for “Railway Diesel ” with the aim of: . Reducing or even eliminating the current tax burden (PIS , Cofins and ICMS) incident on the cost of diesel for the rail sector, in cooperation with the Treasury Department, IRS, SEFAZ/SP, CONFAZ, Ministry of Mines and Energy, Petrobrás, ANP, and now EPL; . Including “Railway Diesel" in taxlegislation, legislation as well as defining, by way of the ANP, its technical and operational feasibility. Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA – technology policies... TaxationTaxation: ANTF action for the Federal Government to apply measures for foreign trade, industry and : – Brasil Maior Plan --PBMPBM: ANTFiscalF Conferenc and e on Appril 2012 introducing a Proposal for PBM t o include the railway sector in order to andexpand Tributary rai l productivity throughout the country... Tributary . Doubling of railway capacity, reaching a fleet of 6 ANTF Press Conference – April 2012 thousand locomotives and 200 thousand wagons, depending on confirmation to expand the network . Unburdening of rail freight transport users, stimulating usage of this service; . Reduction of State taxes, while being exempt from almost all Federal taxes with exception to those on raw materials; . Promotion of lines of financing with terms of 20 to 25 year, with minimal fees. Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA –
Providers: ANTF and Associates acting together with providers... . Identification of – Fiscal and MtiMeetiofngs ProjectsProjects with ItInt Developingernati onal PidProvidanders Tributary . Exoneration of imports in competitive ObjectiveObjective:: making it feasible for foreign companies to open representationTributary areasareas: in theDeveloping country. New : Reclassification of items under New Technologies in “autoparts” or “rail parts”; Technologies in Domestic Revaluation of fixed rates on imports. Domestic and Largest factory of concrete sleepers in the world with a productionand Foreign of 4800 sleepers per day Foreign Markets Markets
. Supporting the Industry the Revitalization . Promoting a Revitalization of productionproduction: a strong,strong of the Quality the National : , competitive and National Railway Price Railway and flexible Time-frame flexible national national Intermodal Integration Integration: : Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA – Competitiveness: AoiteAssociate action etblihingestablishing p tnear hiptnerships with clientlients and otheother ope torators...
generating benefits Partnership between FCA and Multigrain: – Fiscal and annual transportation of 1.2 million tons of corn and soy. . Increase in the national economy´ands efficiency Tributaryand productivity; Tributary . Better efficiency of current transport infrastructure; . Better usageeofof public and private investment in infrastructureinfrastructure;; . Better air quality and care towards environmental conditions, as well as reduction in energy consumption; . Door to door transporttransport..
Brazil Competitive Movement - MBC: ANTF supports MBC which has as its objective the transformation of the cutlure of entrepreneurship and competition into a reality for the Brazilian population, “having qualified companies and a more productive public sector makes the country more competitive”.
Among the main difficulties to Intermodal Transport growth, we find the current taxation system and the legislation on containers, the lack of fiscal incentives for the construction of multimodal terminals and the current state of railway access to ports, as well as the need for implementing electronic transport knowledge (CTe). Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA - R RltiRegulation: AiA series of changes in regultilation have been proposed and publi hs dhed with ththe governmentltal purpose of making the sector even more competitive... promotion changes - Institutional regulation ANTT objectiveschangesfor in sector Primary alterations in sector ▪ Creation of a Multimodal Transport Operator (MTO) post and that of User-Investor ▪ Increase the competitiveness of ▪ Mandatory availability for third parties rail transport, together with the reduction of user costs ▪ Possibility of users contracting minimal services ▪ Increment in the availability of ▪ REDUF (“Regulation Defending Users of Rail Transport service SiServices”) Edition ▪ Reassesment of the cap on tariffs
The Concessionaires agree with the objectives of public policy concerning the elevation of the mode´mode´ss availability and competitiveness, sharing efficiency gains with users, however we also understanunderstandd that the proposed measuresmeasures are not alwayygggjs the most indicated for meeting the suggested objectives.
Source: ANTT and ANTF Associates. Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA- Safety: Concessionaire Action towards Safety and Educational Campaigns to build awareness in communities neighboring railways...
- Institutional
Proposal for together with DENATRAN (Nationalfor Department the of Transit of Brazil), Ministry of Cities and Ministry of Transportation. the Government Government toBrazilian Transit Code (Law nº 9.503/97)
toArt. holdhold 212 a – Not stopping your vehicle before moving through a railway crossing: InfractionaNational‐ veryNational serious Safety (7 negative points on the Driver´s License); Penalty ‐ fee. Safety Education §1º of Art. 90 ‐ The transit departmentEducation Campaign with authority over the passage is responsible for the installation of signs, being liable for the lack, insuffiency or incorrect placement thereof. Campaign: : Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA- Partners of 11 483.483, of 05/31/07, regulated by Decree nº 6 6 018.018, of 05/22/07, which disciplines the jurisdiction of of thethe defunct institutions involveddefunct in the process RFFSA of asset ( inventory, namely: - . Ministry of Transportation:RFFSA (BrazilianInstitutionalcoordenates and supervises the inventory process of the defunct RFFSA;Brazilian Railways . Ministry of Finance: establishes the Contingency Fund for the Defunct RFFSA, Railways Company towards the payment of dues and expenses; . Secretary of State Assets - SPU/MPOG: indicatesCompany) real-estate to be sold, taking into account funds destined ):: Dissolvement of RFFSA by Law nº. to the FC; STN AGU MF ANTT . ANTT (National Transportation Agency): undertake CEF MT inspection for the control and accounting of patrimony of operational assets; IPHAN LawDNIT nº. MC RFFSA MT . DNIT (National Department of Infrastructure of Inventory Transportation): ownership of operational and non- SPU VALEC operational RFFSA assets; MPOG MT National . IPHAN (National Historical and Artistic Heritage SRH Archive MPOG Institute): receive and administrate RFFSA properties, Presidency movable and not movable, of artistic, historical and cultural value, as well as watch over their maintenance and security.
All RFFSA assets and liabilities were appropriated by the State, transferring ownership of its assets and changing from a privately to publicly owned regime. Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA - P d PtPartners of ththe dfdefunc t t RFFSA: Impacts from Dissolving thhe RFFSSA on thhe Addministration of Leased Assets... Leasing- Contracts InstitutionalContracts: Concessionaire . Leased/ Operational Assets: Define Concessionaire Obligations, Responsibility responsible for: watching over the integrity of leased goods.
Law. 11.483/07: . NonNon--LeasedLeased// NonNon--OperationalOperationalAssets: Assets: State Moveable Assets: transferred to SPU; Responsibility Bens Móveis: transferred to DNIT; . LeasedLeased// Operational Assets: Assets: DNIT gains ownership. Measure so that ANTT and DNIT must be responsible for effective oversight and patrimonial control of operational assets Ag T July of 2009: Sigggning of the Aggreement of Technical Cooperation between the present present datebetween ANTT establishedestablished. date administrativeANTT and . administrativeand DNIT, routines DNIT, noting routinesnoting have that that until have not until not been been Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDA -
Partners of the defunct RFFSA: Situation of Movable Rail Assets...
Lot with . Leased/ Operational Assets:- with Unleased Institutional Unleased Rolling Stock Obsolete Materials (past their service life). Materials Rolling Stock . Unleased/ Non-Operational Assets: Scrapped materials railway network,materialssince left concessions began. Materials returned bblefty RFFSA in concessionaires, past the period of contractualincustody. lots and and along Wagons along the the
Locomotives
Estimate of Leased Rolling Stock (Locomotives and Wagons) returned/to be returned = 7 ,400 of ObsoleteObsolete Movable Unleased Rolling Stock(LocomotivesStock(Locomotivesand Wagons) Wagons)= 5,400 Movable Assets
Note: There are other materials, machinery andAssets: ob workshops. :
solete railway equipment in lots and mechanical Challenges in Developing the Railway Sector
STRATEGIC RAIL AGENDAAGENDA-
Represenatives of ANTF and Associates acting together with Partners... . Seminar discussing to settle difficulties and reconcile actions- Institutional towards the administration of rail assets. discussingof thethe the defunct defunct RFFSA: the Registration RegistrationRFFSA: of
of ConcessionConcession Assets Assets between between ANTF ANTF and and ANTT: ANTT: Free Spaces CNJ initiativeSpaces Program to become informed on the issue of obsolete assetsProgram on behalf Meet of the Associates, resulting in the: Meet – – CNJ Railways Creation of a workgroup formedCNJ Railways by the Judicial- and Legislative Branches of government and ANTF; - 08/24/12:08/24/12: Signing of a Term of Agreement and Technical Cooperation Agreement to provide solutions for the removal of locomotives and obsolete wagons in concessionaire owned railway Railways Transport Brazil into the Future with Integration and Development
THE EVOLUTION OF THE BRAZILIAN RAILWAY SECTOR IN THE LAST 15 YEARS: AchievementsAchievements,, Advancesand Challenges
Federal Government Plans and Programs
4 Pla Federal Government Plans and Programs
May 2003: launches the 2003: The the Railways n which Theconsist Federals in a series of ppgrograms, coordenatedRailways b Revitalizationy the Ministry of Transportation, Federal Government together with ANTT and VALEC, wit h the aim of reducing logisticRevitalizations costs: Plan Government . 1st StageStage: Plan PriPrioritizeorit:iz e tthehe rrestorationestoration of ststretchesretches in poopoorr coconditionsnditions, eexhibitingxhibiting llowow dedensitynsity of ttrafficraffic aandnd important functions in meeting market demands ((TheThegovernment is aware that it has granted stretches in poor conditionsconditions));
. 2nd Stage: Provide solutions for essential stretches of primary corridors of exportation,solving logistics bottlenecks (removal of habitation on railway paths and elmination of crossings at critical levels) to increase flow capacity to the country´s main ports, construction of railway variations and contours, with deadlines, reponsible and financial conditions;
. 3rd StageStage: Implement: the Railway Network Expansion Program, which ildincludes the FtFerronorte, NtNorte-SlSul and TdtiTransnordestina PjtProjects. Federal Government Plans and Programs
(“Programa de January 2007 The Federal de AceleraçãoAceleraçãoFederal do Government 2007: : do CrescimentoGovernment deploys PAC is a Crescimentogovernment – program which encompasses aaseriesseries of economic deploys the policies, having as one of its priorities the investment in infrastructure thus –PAC”)PAC”) the Growth improving the arena of private investment, investmentGrowth Acceleration,proposingproposinglong- long-termterm fiscal measuresmeasures,,liftingliftingthe tax burden and betterment Acceleration of the taxationProgram system, as well as stimulating the supply of credit and financing. financing. Program – The infrastructure construction projects announced by PAC are important not only in that–PACPACwhich concerns railways, but all construction projects for portsports,,highwayshighwaysand waterways, waterways,whichwhichwill lead to higher efficiency and better conditions for the intermodality of transport in the countrycountry..
The projects expanding the railway network are medium and long term works whichwhich,,onceonce begunbegun,,bringbring longlasting results as long as they pass the planning stages and are materialized on the trackstracks..
Railway constructions are made feasible mainly by private investment and public financing. Federal Government Plans and Programs
PNLT (“Plano Nacional de Logística e Transportes – PNLT) April 2007 The Federal Government releases the National Plan for Logistics and Transportation – 2007: :
PNLT is along a longterm proposal for the Brazilian State, State,aa partnered study by both the Ministry of Transportation and the Ministry of Defense,with thecollab oration of state governments, institutions, productive sectors, transport operators, construction companies and users.
PlanwhichspurstheGrowthAccelerationProgram(PAC)(PAC)for highwayhighway,,railwayrailwayand waterway works, as well as servin g to subsidize the elaboration of MultiMulti--Annual Plans -PPAs - PPAs, indicating institutionally oriented reccomendations and identifying aportfolio a portfolioof high priority and structural projects for the future economic development of the countrycountry..
PNLT symbolizes the act of taking back the planning process in the Transport Sector, giving it a permanent management structure containing allessentialdataforthesectorbeitconcerning supply or demand.
ThThe plan´s obj tiective itis to reblbalance BilBrazil´s tttransport grid, emphiihasizing the role of railways. Federal Government Plans and Programs
February 2011: 2011: The The Federal PAC 2is 2 isa reiteration of the program launched in 2007, 2007,offerin g Federal Governmentmore funds to continue building logistics and energetic Governmentinfrastructure as well as to sustain growth throughout the countrycountry.. launches the It now incorporates more social and urban infrastructure related the Growth actions to deal withGrowth the issues Acceleration facing major Brazilian cities, with the challenge of making BrazilAcceleration more developed Program and fair for all Brazilians. Program 2 (PAC 2) Expanding the railway network, it reinforces the2link (PAC between 2) railways connected to agricultural and mineral production centers and portss,, idindust tiries and the consumer marktket. To thissenend, it bets on the reevaluation of the regulatory model to create an even more competitive environment in freight transporttransport,, encouraging the use of railway infrastructure capacity and stimul ati ng new ittinvestmentss.. It seeks to guarantee the portfolio of projects to expand and improve railway network use, integrating the network with other transport modalities (higgyhwayssandandwaterwa ys). Another directive that is considered to be important by the government is the investment in high- high-speedspeed railrail.. Federal Government Plans and Programs
Growth Acceleration Acceleration Program
Program (PAC 2) (PAC 2) Federal Government Plans and Programs
August 2012 Highways2012: (“Programa de Investimentos em Logística - Rodovias e Ferrovias ”) : The Federal Government launches the Logistics Investment Program: Railroads and New Railway Investments Stretches being Studied/Analysed PAC Project in Execution Current Network
Source Railways Transport Brazil into the Future with Integration and Development. 15 years of concession. The Next Step until 2030.
A EVOLUÇÃO DO SETOR FERROVIÁRIO BRASILEIRO NOS ÚLTIMOS 15 ANOS: Conquistas, Avanços e Desafios
Conclusion ANTF and Associatessustainable reassert development in its “V inBrasil Brazil. nos Trilhos” t to the continued betterment of the its commitmen Brazilian Railway sector, emphasizing that it needs the State to join forces with private initiative to provide for this transport mode a fundamental fundamental requirement for Thank you!
E-MAIL: [email protected] SKYPE: rodrigo.vilaca1
AntfFerrovia
Rodrigo Otaviano Vilaça www.twitter.com/antf_ferrovia
Visit our website: www.antf.org.br