Brazil will have 5G in 2020 after all

. Jul 03, 2020
Brazil to have first 5G network before delayed auction Image: TarikVision

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We’re covering the pre-launch of Brazil’s first 5G network. Brazil’s plan to surreptitiously privatize Petrobras. The latest Mercosur summit. And when the coronavirus was first found in Brazil.

Brazil to have first 5G network before delayed auction

Telecom giant Claro, owned by Mexico’s América Móvil,

has announced a pre-launch of 5G technology in Brazil. The move comes despite the massive delays to the auction of 5G frequencies in the country.</p> <ul><li>As a matter of fact, Claro is relying on a technology called DSS (Dynamic Spectrum Sharing). It allows the deployment of both 4G and 5G on the same frequency band, dynamically allocating spectrum resources between the two technologies based on user demand.</li><li>Claro and its partners —&nbsp;Motorola, Ericsson, and Qualcomm —&nbsp;will detail the network&#8217;s implementation next week.</li></ul> <p><strong>Why it matters.</strong> The public auction of <a href="https://brazilian.report/tech/2019/12/13/brazil-dithering-on-auction-model-for-5g-spectrum/">5G frequencies</a> was originally scheduled for March, but was pushed back multiple times due to concerns about frequency interference and uncertainties around the rules of the bidding process itself. Then, the pandemic upended the whole process.</p> <p><strong>Change of heart.</strong> As we reported in our <a href="https://brazilian.report/tech/2020/05/08/venture-investment-in-latin-america-still-to-feel-coronavirus-effect/">May 8 Tech Roundup</a>, Claro chief executive officer Paulo César Teixeira had suggested the government should postpone the 5G frequency auction. Two months later, his company is launching Brazil&#8217;s first commercial 5G network.</p> <p><strong>Importance.</strong> 5G could be up to <a href="https://brazilian.report/newsletters/brazil-daily/2020/02/05/industry-numbers-spark-early-2020-pessimism-brazil-orban-5g/">100 times faster than 4G</a> and will power the “Internet of Things” and Industry 4.0. As presented by the U.S. Senate Republican Committee, “the country that leads the world in the adoption of 5G technology will have a distinct technological, economic, and national security advantage over other countries.”</p> <p><strong>Beating bureaucracy.</strong> This won&#8217;t be the first time Claro gets ahead of regulators. In 2007 and 2012, the company also used already-regulated frequencies to implement 3G and 4G, respectively, before bands had been auctioned off.</p> <p><strong>5G diplomacy.</strong> The next generation of the internet is another battleground opposing the U.S. and China. Brazil has carefully avoided picking a side in this particular fight — and <a href="https://brazilian.report/tech/2020/03/28/brazil-quietly-passes-new-5g-regulations-coronavirus/">recent regulations</a> made sure not to ban Chinese behemoth Huawei, while not giving it a completely open market.</p> <hr class="wp-block-separator"/> <h2>How the government tries to circumvent Congress to privatize Petrobras</h2> <p>Senate President Davi Alcolumbre has <a href="https://politica.estadao.com.br/blogs/fausto-macedo/wp-content/uploads/sites/41/2020/07/alcolumbre-petrobras_020720204654.pdf">complained</a> to the Supreme Court that the Bolsonaro administration is using a loophole to quietly launch a process that would essentially privatize oil and gas giant Petrobras.</p> <ul><li>A 2019 Supreme Court ruling established that the government cannot privatize public parent companies without a green light from Congress. However, it is free to sell off subsidiaries.</li><li>According to Mr. Alcolumbre, the government is slicing up Petrobras assets into multiple subsidiaries to circumvent Congress while respecting the decision. &#8220;These new companies are being artificially created with the sole purpose of allowing for a direct sale to private markets,&#8221; wrote Mr. Alcolumbre. &#8220;It will be possible to dispose of the company&#8217;s entire strategic assets.&#8221;</li></ul> <p><strong>Why it matters.</strong> Petrobras is Brazil’s biggest company and is responsible for 93 percent of the oil produced in the country. The firm has often been vulnerable to political interference in its pricing policy and has been the source of several corruption scandals.</p> <ul><li>Some experts believe that a private Petrobras would be more efficient, “<em>having</em> to make the right call,” as Vladimir Fernandes Maciel, coordinator of the Economic Freedom Center at São Paulo’s Mackenzie University, <a href="https://brazilian.report/business/2019/04/30/brazil-privatizing-petrobras/">told</a> <strong>The Brazilian Report</strong> last year.&nbsp;</li></ul> <p><strong>Strategy.</strong> Economy Minister Paulo Guedes has never been coy about his wishes to privatize &#8220;every single federally-owned company&#8221; in the land. But the move is <a href="https://brazilian.report/business/2018/11/09/brazil-privatization-austerity/">hugely unpopular</a> among voters and lawmakers alike.&nbsp;</p> <hr class="wp-block-separator"/> <h2>Bolsonaro goes easy on Mercosur summit</h2> <p>In a remote summit with leaders of Mercosur nations, President Jair Bolsonaro avoided controversy. He didn&#8217;t hint at a possible exit from the bloc (shared with Argentina, Paraguay, and Uruguay) nor did he antagonize Argentina&#8217;s left-leaning President Alberto Fernández, with whom Mr. Bolsonaro has traded harsh words in the past. However, it&#8217;s not as if we can say all member countries are on the same page.</p> <p><strong>Argentina.</strong> The Fernández administration has opposed the other members&#8217; push for free-trade agreements with South Korea, Singapore, Canada, and Lebanon. It has also been critical of the 2019 deal with the European Union. Moreover, Buenos Aires is a staunch opponent of lowering common import tariffs.</p> <ul><li>A Brazilian <a href="https://brazilian.report/newsletters/brazil-daily/2019/10/23/brazil-plan-slash-import-tariffs-mercosur/">plan unveiled in October 2019</a> would slash average tariffs on industrial goods from 13.6 to 6.4 percent. Brazil would have lower tariffs than Canada on textiles, than Japan on shoes, and than the EU for fertilizers and pesticides.</li></ul> <div class="flourish-embed flourish-chart" data-src="visualisation/810694" data-url="https://public.flourish.studio/visualisation/810694/embed"><script src="https://public.flourish.studio/resources/embed.js"></script></div> <p><strong>Why it matters.</strong> With different strategies and goals, Mercosur countries rarely act as if they are members of a common trade bloc — each pushing for their own independent agendas.</p> <p><strong>Image job.</strong> In his statement, Mr. Bolsonaro said he wanted to correct &#8220;distorted opinions&#8221; about his administration — which has come under fire for not doing enough to control deforestation. Brazil&#8217;s laissez-faire approach has been used as an excuse for several European countries to threaten to cancel the Mercosur-EU deal.</p> <hr class="wp-block-separator"/> <h2>Coronavirus was in Brazil as early as November 2019, says study</h2> <p>A study by the Federal University of Santa Catarina showed that the SARS-CoV-2 virus, which causes Covid-19, was present in Brazil at least three months before the first confirmed case was reported. The virus was detected in two independent human sewage samples collected in Florianópolis on November 27, 2019 —&nbsp;and recently tested.</p> <ul><li>Disclaimer: the study is still under peer review, but a <a href="https://www.medrxiv.org/content/10.1101/2020.06.26.20140731v1.full.pdf">preliminary version is available</a> on the MedRxiv platform.</li></ul> <p><strong>Why it matters.</strong> The discovery is further evidence of how little we know about the path of the virus&nbsp;— which makes Brazilian states&#8217; rushed push for reopening all the more dangerous.</p> <p><strong>Underreporting.</strong> The third phase of a study to test hundreds of thousands of people and then estimate the extension of the spread in Brazil — carried out by the University of Pelotas and pollster Ibope — suggests that 4 percent of Brazilians have developed coronavirus antibodies, meaning that over 8 million people could have been infected in the country.</p> <hr class="wp-block-separator"/> <h2>What else you need to know today</h2> <ul><li><strong>Aviation. </strong>Brazilian planemaker Embraer issued a statement proposing trade unions a voluntary redundancy program for employees currently placed in collective vacations due to the pandemic. Unions have accused the company of lacking transparency, saying Embraer has not disclosed the number of people it plans to include in the program. Labor representatives are in favor of the nationalization of Embraer and stability for its workers.</li><li><strong>Diplomacy. </strong>After <a href="https://brazilian.report/newsletters/brazil-daily/2019/08/28/brazil-france-relations-macron-bolsonaro-car-wash/">months of public squabbles</a>, Brazil and France will try to mend fences in a video-conference call scheduled for Tuesday, July 7. Tensions began to rise after French President Emmanuel Macron called out Brazil for letting deforestation rates peak — to which the Brazilian president responded, by mocking Mr. Macron&#8217;s wife&#8217;s appearance. While France accounts for only 2 percent of Brazil’s imports, French presence in the country is quite important — companies from France are the biggest foreign employers in Brazil, with over 500,000 direct jobs.</li><li><strong>Bonds.</strong> Uruguay&#8217;s coronavirus response has been stellar, with fewer than 1,000 cases and only 28 confirmed deaths so far. And the country&#8217;s dollar sovereign bonds due in 2025 have performed better than those of any other Latin American nation, according to the Bloomberg Barclays Index. </li><li><strong>Corruption.</strong> Operation Car Wash launched a new phase this morning, with federal marshals carrying out search and seizure warrants in São Paulo and Rio de Janeiro. The latest investigation concerns schemes of international money laundering related to infrastructure projects in São Paulo. Former state governor José Serra is among the targets. This is only the second operation by the Car Wash task force this year — a sign that its <a href="https://brazilian.report/power/2020/07/02/brazil-operation-car-wash-the-end-seems-near/">momentum seems far gone</a>.</li><li><strong>Unwanted protection.</strong> Leaders of the Yanomami indigenous community say a military mission aimed at protecting them has instead put the tribe at a <a href="https://brazilian.report/society/2020/06/14/coronavirus-accelerating-genocide-brazil-indigenous-people/">greater risk of Covid-19 contamination</a>. The mission brought medical supplies to outposts near the border with Venezuela and tested Yanomami people for the coronavirus — all being recorded by journalists. Prosecutors will investigate the violation of indigenous&#8217; wishes to remain isolated from urban communities.</li><li><strong>Basic income.</strong> As President Jair Bolsonaro harvests political gains with the coronavirus emergency salary, the left-wing Workers&#8217; Party is launching a campaign to recover one of its historical causes: a <a href="https://brazilian.report/power/2020/05/31/ubi-could-brazil-launch-universal-basic-income/">basic income</a> for poor populations. Since its inception, in the early 1980s, the party has been in favor of cash-transfer programs — but now sees itself excluded from the discussion about the much-needed aid program for workers affected by the Covid-19 crisis. The party of former President Lula has failed to make a mark as the main opposition force to Mr. Bolsonaro, and hopes to regain its relevance as the emergency salary is set to end after five installments.

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