rio de janeiro: urban opportunities
TRANSCRIPT
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Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
RIO DE JANEIRO: RIO DE JANEIRO: URBAN OPPORTUNITIESURBAN OPPORTUNITIES
World Bank URBAN DAY 2008
Joaquim V. F. LevySecretaria de Fazenda - RJ
February 2008
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
2
Welcome to Rio de Janeiro
Rio de Janeiro, Political and Financial Center
PROJAC – hallmark of the entretainement industry
A P40 oil plataform joining the oilprovince
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Introduction
Strategy for selected sectors
Transportation
Economic Growth
Integrated GrowthPAC das Favelas
Entrepreneurship
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
4
Rio de Janeiro: a “small open economy”
Source: CIA Yearbook, PIB US$ taxa de cambio oficial
P O P U L A Ç Ã O A R E A P IB U S $ B i lh ã oR IO d e J A N E IR O 1 5 .3 8 3 4 3 .6 9 6 1 3 9 ,3
A r g e n t in a 4 0 .3 0 2 2 .7 6 7 2 1 0 ,0 C h i le 1 6 .2 8 5 7 5 7 9 9 ,6 C o lo m b ia 4 4 .3 8 0 1 .1 3 9 1 0 6 ,8 V e n e z u e la 2 6 .0 2 4 9 1 2 1 4 9 ,9
C z e c h R e p u b l ic 1 0 .2 2 9 7 9 1 1 9 ,1 H u n g a r y 9 .9 5 6 9 3 1 1 3 ,2 P o r tu g a l 1 0 .6 4 3 9 2 1 7 6 ,8
M a la y s ia 2 4 .8 2 1 3 3 0 1 3 2 ,3 P h i l ip p in e s 9 1 .0 7 7 3 0 0 1 1 6 ,9 N ig e r ia 1 3 5 .0 3 1 9 2 4 8 3 ,4 S o u th A f r ic a 4 3 .9 9 8 1 .2 2 0 2 0 1 ,4
0 50 100 150 200
Nigeria
Philippines
Malaysia
Portugal
Czech Republic
Venezuela
Colombia
Chile
RIO de JANEIRO
PIB em US$ Bilhões
ERJ GDP in dollars is aboutthe same ofthat of Malaysiaor Colombia
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Rio de Janeiro: an energy rich province
The new mega fields of Tupy andSaturn are off shore Rio de Janeiro
ERJ accounts for 80%+ of
Brazil´s oil and natural gas
production
Total Oil Production(million barrels per day)
5) Mexico 3.87) Canada 3.18) Norway 3.09) UAE 2.810) Venezuela 2.811) Kuwait 2.712) Nigeria 2.613) Algeria 2.114) Brasil 2.0
Rio de Janeiro 1.7
Top World Oil Producers, 2005*
Rank Country
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
PIB
100
300
500
700
900
1100
1300
1500
1970 1975 1980 1985 1996 2003
Índi
ce (1
949
= 10
0)
Brasil
Estado
RM
Capital
With important challenges
The metropolitan area hasstagnated in the last 30 years, with many industries leaving thestate
High dispersion of theHuman DevelopmentIndex, with seriousproblems around thecapital
IDH dispersion in Rio de Janeiro
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Proporção (%) de população urbana em 2005
0
10
20
30
40
50
60
70
80
90
100
RJ DF SP AP GO MS MS PR ES SC SE RR RS PB AM MG PE CE PA RN TO AC RO BA MA AL PI
Brasil (82,8)
96,6
Fonte: IBGE.
Urbanization has taken a toll
1960 2000Conventional Areas 335 063 1 910 145Favelas 1 092 476 4 765 428Ratio 23,5% 28,6%
% population living in Favelas in Rio
State of Rio de Janeiro 807Regiao Metropolitana 816Belfort Roxo 742Duque de Caxias 753Itaborai 768Magé 746Nilópolis 788Niteroi 886Nova Iguaçu 763Queimados 732Rio de Janeiro 842São Gonçalo 782São João de Merity 774
State of Bahia 688State of Pernambuco 705State of São Paulo 820State of Santa Catarina 822
HDI - 2000
Note: HDI of Rocinha = 735Homicide Rates
Rio de Janeiro (2006) 57Washington D.C. 46Detroit 42Baltimore 38Chicago 22Johannesburg (2001) 75Moscow (2003) 20
Murders/100,000 people (2003)
Urbanization Rate
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
... in a complex institutional environment
State, municipalities and the Union are all “entities” at the same footing, even if they have different responsibilities and rights
States have the right to create Metropolitan Regions, but not much power to make them to work in a coordinated fashion • states don’t have fiscal or financial leverage
Financial crises reduced planning and infrastructure investment•decentralization reduced weight on planning in the 1990s• some reversals more recently
• e.g., pools-consorcios of cities• PAC negociated with states and cities
2006 elections brought new opportunities for cooperation at the city, state and federal levels and more emphasis on institutions in Rio de Janeiro
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Introduction
Strategy for selected sectors in the ERJ
Transportation
Economic Growth
Integrated GrowthPAC das Favelas
Entrepreneurship
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Transportation is a key challenge
Forty years ago...
Now...
While transport demandhas changed dramatically, the rail system was stuckin the past
2008
ths pass. % totallocal bus 5.300 56%intercity bus 1.332 14%trains 500 5%metro 500 5%vans 1.600 17%other 250 3%
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
... that is being addressed
Paying for new air-conditionedtrains (WB loan and state money)
Repressing irregular ‘vans’, reducing money launderingopportunities
Enhancing the MetropolitanTransportation Agency (AMTU)
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Goals: reduce transportation cost and improveservice
Investments in the Metro
It costs too much to travel in Rio´s Suburbs
> R$ 4,50
4,50 > 2,70
The subway will invest R$ 1,2 billion to double its capacity by 2011
Single ticket can smooth thetransition
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Introduction
Strategy for selected sectors
Transportation
Economic Growth
Integrated GrowthPAC das Favelas
Entrepreneurship
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
The metropolitan region of Rio de Janeiro willbecome a prime logistic platform
PORT of Rio
Arco Rodoviário
70% of Brazil s GDP is within 500 km
PORT(Itauguai) and new Thyssen mill
Dutra
BR 040BR 116 Bahia
COMPERJ
Airport
MRS e outras ferrovias
Old Refinery
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
The U$ 8,5 Billion COMPERJ investmentshould not worsen urban conditions
0
20
40
60
80
100
120
São
Gon
çalo
Gua
pim
irim
Mag
é
Tang
uá
Mar
icá
Itabo
raí
Top
10
10 to
20
20 to
30
30 to
40
40 to
50
50 to
60
60 to
70
70 to
80
80 to
90
90 to
92
ESTADOCOMPERJ
% households with water in ERJ andin COMPERJ area
Expectation of 3,500 new jobs whenoperating and up to 200,000 jobs (directand indirect) in the next 5 years, part ofwhich during construction
Avoiding new slums and undue pressureon public services is a priority to thegovernment
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Planta de Tratamento de Alegria – em construção desde 1995, deve começar a operar em março 2008
Forum COMPERJ is a key tool to urban planning
Forum COMPERJ is headed by thegovernor and includes
• most State offices• federal entities (Petrobras, CEF, Banco do Brasil, , BNDES, etc.)• muncipalities
• Coordinates efforts in the social, economicand environamental front• Holds regular seminars and meetings (e.g., February 21, with schollars, politicians, andthe civil society)• Organizes public contests to selectarchitectural and urbanistic projects• Ensures permament dialogue betweenregulators and businesses (e.g., Petrobras, Cedae, Environment)
01 02 03 04 05 06 07 08 09 0
1 0 0
São
Gon
çalo
Mag
é
Itabo
raí
Tang
uá
Gua
pim
irim
Mar
icá
Top
10
10 to
20
20 to
30
30 to
40
40 to
50
50 to
60
60 to
70
70 to
80
80 to
90
90 to
92
E S T A D O C O M P E R J
% households with sewage in ERJ and in COMPERJ area
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Financial and Operational IndicatorsCEDAE SABESP COPASA
Market potential size (million 12,3 25 13,1Coverage (%)
Water 78 89 83Sewage 40 72 41
Tariff (R$/m3) 1,54 1,61 1,37Physical Losses (%) 49,7 35,8 23,9Market Losses (%) 30 11 13Total Assets(R$ million) 4.502 16.783 3.206Total net sales (R$ Million/year) 1.324 4.131 1.300Market Value (R$ million-2006) n.a. 7.404 2.323Ratings na BB (F); BB- naFonte: SNIS/Diagnóstico dos Serviços de Água e Esgotos – 2004
CEDAE will access the capital markets
• CEDAE needs to deal with municipalities, including those thathave privatized their services
• New sanitation law (2006) will require to accomodate manydemands, but still favors a strong, responsible statewide sanitationcompany
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Introduction
Strategy for selected sectors
Transportation
Economic Growth
Integrated GrowthPAC das Favelas
Entrepreneurship
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Private and public agents are eager to invest in thePort of Rio de Janeiro
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public GoodMANGUINHOS
Urban Renewal is needed and feasible
Manguinhos is a deteriorated area with an excellent location: PAC aims ate allowing the place to fulfill its potencial
Morro do alemão
PORTof RIO
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Favelas don´t come cheap
Dwellings in Rocinha havemost modern homeappliances, but healthindicators are very badand garbage is a hazard
Favelas are a prime example of unbriddled capitalism: tall buildings and narrow streets. Unfortunately theirbase is schaky with poor property rights and informal enforcement of those existing
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
TELEFÉRICO – CONEXÃO METRÔ e ÔNIBUS
Renewal of Morro do Alemão will require a blend of new public equipment and more
security
metro
Bus trunkTeleferic
Lowering the cost of getting to work andmake the area accessible to health andschool services are top goals of the PAC
Success willdepend ongoodcoordintationbetween city, state andfederal government
Parque no alto do morro
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
Introduction
Strategy for selected sectors
Transportation
Economic Growth
Integrated GrowthPAC das Favelas
Entrepreneurship
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
First saleInovation
Lowering the cost of opening businessesrequires city, state and federal efforts
8.1
42.6
7.6
41.6
6.352.8
5.535.4
7.6
48.6
2.941.0
9.5
43.2
3.244.2
7.8
41.7
2.947.6
8.6
42.9
3.844.8
8.1
43.4
3.045.5
7.6
40.0
3.848.6
8.3
40.6
4.246.9
7.5
40.9
4.347.3
8.2
43.3
4.144.3
8.7
40.2
4.346.7
9.7
41.1
3.245.9
8.7
38.0
4.348.9
8.9
38.9
6.745.6
9.1
34.1
6.850.0
7.134.8
7.150.9
7.7
35.6
9.6
47.1
7.136.7
9.2
46.9
7.133.7
10.2
49.0
8.6
32.3
10.8
48.4
020
4060
8010
0P
erce
ntua
l
2005
m1020
05m11
2005
m1220
06m1
2006
m220
06m3
2006
m420
06m5
2006
m620
06m7
2006
m820
06m9
2006
m1020
06m11
2006
m1220
07m1
2007
m220
07m3
2007
m420
07m5
2007
m6
Nota: Dt 1pagmento - Dt JUCERJA - 30
88 dias
Proporção do Tempo Gasto pelo EmpreendedorMédio por Etapa do Processo (%)
Jucerja ContribuinteSefaz Municipio, contribuinte e outros
Waiting time is mostly at themunicipal level and idle time
Recently, the stateinnovated integrating the workof the trade board (Jucerja) with the tax bureau (Sefaz-RJ)
Time to get the state permitdropped to less than 2 weeks(average 2nd half of 2007)
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
[58.00,74.00](74.00,81.50](81.50,86.50](86.50,93.00](93.00,102.00](102.00,160.00]
Fonte: SAPP/SEE/SeFazNota: 2005-2007
Tempo gasto pela maior parte dos empreendedores por município
Next step: incorporate fire and other city permits
Use of the new streamlinedservice for state permit hadmore impact in the interior
Partnerships with Niteroiand Petropolis should kick offsoon
Integration with city taxdata has also been effectivewith respect to propertytransactions (e.g., ITD)
In doubt about where to locate yourself, chose Rio, which is business and user friendly.”
Lord Levene in 2008, when announcing that Lloyd´s will make Rio de Janeiro its platform for Brazil and SA
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Obrigado !
Niterói Campos Costa Verde
Teresópolis
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good
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Rio de Janeiro, o melhor lugar para trabalhar
Recte Rempublican GerereGerindo a coisa pública corretamenteGood Management of the Public Good