Governor of SP proposes that states pay lower interest on debts with the Union; Farm agrees to negotiate

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Tarcísio de Freitas met with the Minister of Finance, Fernando Haddad, in Brasília. The governor’s idea is to open space for states to make more investments. The governor of São Paulo, Tarcísio de Freitas (Republicans) TV Globo/Reproduction The governor of São Paulo, Tarcísio Gomes de Freitas, proposed this Wednesday (13) to the Minister of Finance, Fernando Haddad, that the so-called “indexer” be changed ” of state debts. In other words, Tarcísio defended a change in the debt correction format, so that states pay less interest to the federal government in their debt refinancing contracts. “The states of the South and Southeast made a change, today I have a hybrid indexation, now Selic [atualmente em 11,25% ao ano]now IPCA [4,72% em 2023] plus 4% [ao ano]. The idea was to have an indexing [dos contratos das dívidas dos estados] that would accompany the long-term growth of the Brazilian economy. So, 3% per year”, stated the governor of SP, Tarcísio de Freitas. According to him, Haddad’s minister informed that he will make a presentation to the President of the Republic, Luiz Inácio Lula da Silva, and then call the states to talk about the indexer of state debts. The idea, informed the governor, is to send a bill to the Legislature, in the first half of this year, with adjustments to the current format for correcting these debts. Sought by g1, the Ministry of Finance confirmed that it accepts negotiating the way in which the states’ debt is corrected. According to figures from the National Treasury Secretariat, the debt of the state of São Paulo with the Union totaled R$ 278.7 billion at the end of 2023. This debt is the result of a contract signed between the National Treasury and states and municipalities in 1997, which assumed the debt of these federative entities. These, in turn, were prohibited from issuing any securities on the market and committed to paying their installments on time, in addition to implementing programs of adjustment in your public accounts. Governor Tarcísio de Freitas stated that the state of São Paulo pays around R$21 billion in so-called “debt services” per year, which compromises investments. “Let’s try to give an order of magnitude. The biggest work being carried out in Latin America is the work on line 6 of the São Paulo subway. There is R$18 billion in investment. So, if you pay R$21 billion in debt service for year, you are paying a line 6 per year and there are still R$3 billion left”, he declared.

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