The Brazilian government has announced a new phase of its Logistics Investment Program (Programa de Investimento em Logística, or "PIL") which aims to modernize Brazil’s infrastructure and stimulate economic growth. The PIL contemplates infrastructure investment totalling R$198.4 billion (US$66 billion), including R$69.2 billion investment between 2015 and 2018.
The PIL, first created in 2012, has now been expanded in a moment of economic slowdown in Brazil and seeks to rekindle economic growth at the same time as improving Brazil's transportation and logistics infrastructure. The new program is designed to attract greater private investment and financing, although will continue to enjoy strong support from Brazil's development bank (BNDES), offering substantial funding at below-market rates. The PIL is expected to generate significant interest from foreign contractors and investors with resources to meet the substantial equity and debt financing and technical requirements for the underlying projects. Such support may be pivotal in light of the higher levels of participation expected from mid-sized Brazilian contractors in such projects. The largest project of the PIL, the R$40 billion Bi-Oceanic Railway to connect the Atlantic and Pacific coasts of South America, has already attracted pledges of cooperation and funding from the Chinese government.