Embratur may close without Sistema S, says Freixo – 05/22/2023 – Market

Embratur (Brazilian Agency for International Tourism Promotion) runs the risk of running out of budget in early 2024 if Congress does not approve the transfer of funds from the S System to the company, says the entity’s president, Marcelo Freixo (PT) .

The lack of resources also threatens the implementation of actions this year and the promotion of Brazil abroad as a tourist hub, the body’s main function, adds the former federal deputy.

According to Freixo, Embratur currently has a budget just to maintain the current operation. The money currently used is the result of some resources established by the MP (provisional measure) which, in 2019, transformed the entity into an autonomous agency. It also stems from a contract with Sebrae, which has a determined value and ends next year.

“If nothing is done, this contract will end. Next year, it closes its doors. There is no longer a tourism promotion company in Brazil”, he says to Sheet.

“What I am debating is that you cannot have a company as strategic, as important for development, employment and income in Brazil, as is Embratur, in a sector where Brazil is so powerful, which is tourism, without budget,” he criticizes. “That’s the painting.”

Currently, the MP from the government of Luiz Inácio Lula da Silva (PT) is pending in the Senate, which provides for the transfer of 5% of the collection of Sesc (Social Service of Commerce) and Senac (National Service of Commercial Learning) to the agency – the text has already was approved by the House. Freixo argues that there was an objective criterion to define the entities that would transfer resources to Embratur.

“Trade is what most gains from the growth of tourism,” he says. “The more tourists we bring here, the more Sesc and Senac collect, the more culture gains, the more hotels earn. It is the sector that most benefits from investment in tourism”, she says.

There was, however, resistance in the Senate, thanks to lobbying by the entities of the S System. To resolve the impasse, Freixo tried to sew an agreement, with the help of Davi Alcolumbre (União-AP) and the President of the House, Rodrigo Pacheco (PSD -MG).

Instead of allocating 5% of the collection –which would amount to around R$450 million–, a fixed amount would be passed on –around R$300 million, divided among the entities– for four years. It would be the deadline for Embratur to find a new source of income. The former deputy, however, says he was surprised to learn that the proposal was not accepted.

“They [entidades] they know they have money, they know that our claim is fair and that this money is important for tourism, but they think that [se o percentual for aprovado] others [órgãos] they can come later asking also for a percentage [da verba]”, it says.

“I think this agreement [da verba por tempo determinada] would solve it, but they didn’t want to. We can be defeated and they can withdraw that part of the text, in the Senate, but then it goes back to the House”, he adds. “And it goes back to the House to vote for the 5%, because they didn’t want an agreement.”

The former deputy also recalls that the Bolsonaro government sent an MP to Congress that provided for the transfer of 15% of the S System to Embratur. Freixo himself was against it at the time – because he understood that the percentage was too high. However, he adds, no other funding forecast for Embratur has been established.

“Now, in the Senate, there are some requests to withdraw the 5% from the text precisely from Bolsonarists. The same parliamentarians who, in the Bolsonaro government, wanted to pass on the 15%, now do not agree with 5%”, he says.

In Freixo’s evaluation, the situations are different, because the 5% would represent only a quarter of the entities’ “leftovers” – that is, of what is not used by Sesc and Senac.

“ER$ 400 million to promote a country the size of Brazil, with the diversity it has, is nothing”, he says. “Just to give a comparison: Portugal has the population of Pernambuco and the size of Rio de Janeiro. What is the budget that Portugal has to promote tourism in Portugal? 250 million euros”, she criticizes.

The president of Embratur also says that the solution to absorb funds from the S System was presented by a consultancy from the FGV (Fundação Getulio Vargas), who also showed other possible sources of income — but without such an immediate effect.

According to him, as soon as it is regulated by the government, a source of funding may be the income from the collection of taxes from sports betting houses. The government is preparing a MP on the subject, but the text is not yet ready and needs congressional approval.

Freixo also states that the current budget does not allow investment in new tourism promotion programs prioritized by the company, such as afrotourism. Among the actions is the construction of a museum at Cais do Valongo, in Rio de Janeiro, the port that most received slaves in the world.

The lack of money also affects the creation of tourism promotion policies in partnership with Portugal aimed, above all, at Luso-Brazilian literature.

“Tourism is a project for the country. We have creativity, we have ideas, but to transform this into a product that generates jobs and brings people [para o país], you have to have money. we are working out [esses projetos]but to put it into practice, it needs new investments”, he adds.