Brazilian President Jair Bolsonaro went to Congress on Tuesday to deliver a provisional measure associated with his government’s plans to privatize state-run electricity provider Eletrobras.
Bolsonaro, who is under fire for announcing a shakeup at Petrobras that sent the oil company’s stock tumbling due to fears of government meddling, delivered the measure in person to show his commitment to privatizing state firms.
“Our privatization agenda is going full steam ahead,” he said after meeting with the leaders of Congress.
Senate head Rodrigo Pacheco and lower chamber Speaker Arthur Lira said the measure, a decree that requires congressional approval, would be fast-tracked.
Preferred and common shares in Eletrobras soared, the government was to unveil the privatization measure. Preferred shares rose more than 10% by end of afternoon trading.
“The provisional measure signed by President Bolsonaro authorizes the start of the procedure needed to enable a future privatization of Eletrobras and its subsidiaries,” said a statement issued by the ministries of Economy and Energy.
The measure, which would allow development bank BNDES to work on the privatization of Eletrobras, excludes only two of its units: Brazil’s nuclear energy company Eletronuclear and its stake in the Itaipu dam, a partnership with Paraguay.
A government source said the measure should “signal” to the market Bolsonaro’s commitment to the sale after his decision to replace the CEO of Petrobras, announced on Friday in a social media post, led to doubts over his divestiture plans.
Petrobras shares plunged 22% on Monday, wiping out 71 billion reais ($13 billion) in market value, as Bolsonaro again slammed its pricing policies after he moved to replace the company’s market-friendly CEO with a retired army general.
Shares recovered by rising 12.7% on Tuesday, but uncertainty remains in the market as to possible interference by Bolsonaro in the company’s fuel pricing policy with a view to boosting his popularity ahead of a 2022 re-election bid.