NEW YORK/BRASILIA Brazilian President Dilma Rousseff and her economic team courted Wall Street on Wednesday for investment in a massive plan to upgrade roads, airports and other infrastructure that has gotten off to a rocky start.
Investments to improve dilapidated roads, ports, railways and airports are crucial for Rousseff's strategy to recover confidence in Brazil and bolster an economy that has struggled to grow over the last three years.
Her government is worried by the initial lack of interest in concessions being offered to private companies, which appear reluctant to commit to the projects due to fears of excessive government intervention.
Rousseff assured investors at a Goldman Sachs event that her country has never broken a contract and never will do so.
"I believe Brazil can offer opportunities that very few countries in the world can," she told an audience of bankers and business people. "Legal risk does not exist in Brazil."
Brazil is scrambling to lift anemic investment levels that have kept its economy stagnant, but concerns that the government is meddling in contracts has dented investors' appetite for logistics tenders that started last week.
A deserted highway tender, a last-minute postponement in a high-speed train concession and disappointing participation in the upcoming auction for the huge Libra offshore oil prospect have cast doubt on Brazil's ability to draw investors.
"The question that remains is how big the intervention by the government can get," Marcelo Michalua, a partner with RB Capital, one of the country's largest securitization firms, told Reuters before the Goldman Sachs event. "Based on this perception, investors may delay potential investments in infrastructure projects."
Brazilian Finance Minister Guido Mantega, speaking a few hours before Rousseff, tried to assure investors that the government planned no more changes to the concession rules.
The only adjustments planned aim to improve conditions for investors, said Mantega, who a day earlier lunched with dozens of investors including executives from 3G Capital, Pimco and Brookfield.
"All the accumulated demand for infrastructure in Brazil guarantees the success of these concessions," said Mantega.
Brazil's severe infrastructure bottlenecks have kept the world's No. 7 economy from growing more rapidly, complicating the Rousseff administration's repeated efforts to revive activity.
Airports often teem with angry passengers, trucks can sit idle for days in miles-long lines to deliver goods to port, and traffic is so bad that it is blamed for stunting economic growth in major Brazilian cities.
(Reporting by Luciana Lopez and Alonso Soto; Writing by Alonso Soto)