SHOCK RESIGNATION AT SANTOS

Casemiro Tercio Carvalho was appointed as President of the Santos Port Authority (SPA, formerly called Codesp), in February 2019. He hit the ground running at the Intermodal South America conference in Sao Paulo outlining his ambitious, indeed revolutionary, programme to many port users and, indeed, to this writer at the time.

Among his “avowed intents” was to “kick-start” the stalled privatisation programme at South America’s biggest port for containers (4.3 million TEU handled in 2019) and to make the SPA profitable. With much gusto Carvalho re-negotiated expiring contracts and turned a Reai468.7 million ($125.3 million then, but $80.03 million today) loss in 2018 into a Reais87.3 million ($14.9 million) profit for 2019. Despite COVID-19, a tender process will be initiated in August 2020 for a wood-pulp terminal and a study is underway to pave the way for the privatisation of the SPA port authority itself.

Carvalho was hand-picked by Infrastructure minister Tarcisio Gomes de Freitas but, according to three confidential sources in Santos and Sao Paulo, the ex-SPA head seems to have had a disagreement on some aspects of the privatisation processes currently being undertaken in Santos. He also got caught in the crossfire between Brazil’s President Jair Bolsonaro (the Trump of the Tropics) and Sao Paulo state governor Joao Doria, who will stand against him in the next, 2022, Presidential Election. Doria has been scathing about the maverick president’s “negligent and idiotic” downplaying of the Coronavirus and Carvalho has close links with Doria’s PSDB party.

The departing SPA president also declared last year he would “take politics out of Codesp” and make it “much more professional” so it is somewhat ironic that he has departed with whispers in Brasilia that Bolsonaro may eventually appoint someone from the Centrao party, who he is targeting for Congressional support, to eventually head up the SPA. Carvalho had also made a number of enemies in the port, say the Santos-based sources.

“Tercio ruffled more than a few feathers,” said one individual, who wished to remain anonymous. “Some operators and port users believe that many of his changes were necessary, but he tried to carry them out too quickly and with a touch of arrogance at times.”

Individuals supporting him within SPA and one shipping agent who knew him well, say that the “entrenched vested interests” in Santo were not interested in any progressive changes and so a tough incumbent heading up the SPA was “definitely needed”. Another former colleague added further clarity. “I think Tercio was just super confident, I don’t think he was arrogant,” he explained.

Carvalho said in early 2019 that a number of contracts Codesp had signed with long-term port terminal operators were “far too generous” and when they expired they would have to be re-negotiated with far less onerous terms for the port authority. This would, he argued, prepare Codesp (now SPA of course) for privatisation, which was his and Brasilia’s ultimate goal.

Five of those contracts were with Transpetro (the state controlled oil giant), Suzano (a wood pulp producer), Termares (an inland container warehouse operator), Transbrasa Transitaria Brasileira (a warehousing and logistical company with an inland terminal) and Perola SA (a fertiliser terminal) and the extra income derived from the “new, fairer contracts” (at least in Carvalho’s view) helped secure Codesp its 2019 profit of nearly $15 million.

In his resignation letter Carvalho outlined his achievements and stated that heading up the port of Santos was “the biggest challenge” of his career so far. He added in the note: “New lease contracts are now at market prices, with the correct remuneration for the SPA.”

Carvalho’s successor has been named as Fernando Biral who has been working as Carvalho’s vice president – and as Chief Financial Officer for Codesp – since April of last year. Not much is known about him outside of SPA, but he has a reputation as being “a serious technico” with an “outstanding financial background with blue chip companies”.

SPA said all of Carvalho’s team had been kept on and no other changes were anticipated. “Hmm! At least for now,” said a veteran terminal manager.

In Port Strategy’s July/August edition there will be a feature on Biral and his plans for Santos.