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Regulation and Compliance > State Regulation

Last-minute Olympic fundraising, organizers turn to Petrobras

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(Bloomberg) — With less than two months before the start of the 2016 Olympic Games, Brazilian authorities are scrambling to finish a subway expansion and the velodrome. They’re also trying to assuage fears about the Zika virus. And the country is in an unprecedented economic and political crisis.

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Against this backdrop, Sports Minister Leonardo Picciani said that Rio 2016 organizers are seeking more sponsorship from state companies to shore up resources for the opening ceremony, which has a budget of 250 million reais ($72.9 million).

No decisions have been made about which company, though Picciani mentioned both Rio de Janeiro-based Petroleo Brasileiro SA, the postal service and export and investment agency Apex-Brasil, as well as state-controlled banks. Brazil’s acting president Michel Temer and IOC President Thomas Bach will meet with Picciani next week to discuss possible sponsors

The Lausanne, Switzerland-based IOC is looking for more financial wiggle-room, said Picciani in an interview at Bloomberg headquarters in New York. “They have brought up issues of currency fluctuations, but even if the government or any state-owned company doesn’t sponsor the event, they have their own contingency plans.”

With regard to the subway, the minister said the new line is expected to be finished by Aug. 1 or 2, just before the Aug. 5 Opening Ceremony. The expansion is critical to transporting Olympics employees and volunteers to the Olympic Park in Barra de Tijuca, some 20 miles away from Rio’s well-known Copacabana and Ipanema hotel districts — and more than an hour by taxi with regular traffic.

“The contingency plan, only if necessary, will be the use of the BRT, the fast-lane buses,” he said. “But our conviction as of today is that the subway system will be working.”

The minister also played down the Zika risk, saying the number of reported cases had been declining in recent months and could reach near-zero levels by the time the Games start in August, thanks to prevention efforts and the change in temperature and rainfall during the South American winter. He also pointed out that Zika isn’t exclusive to Brazil.

It is more prevalent in Brazil, though, as is microcephaly, which researchers say the virus can cause in unborn children. A World Health Organization report published this Thursday showed 1,551 confirmed cases of Zika-related microcephaly in Brazil, while no other country had more than eight. More detailed data provided by the Brazilian government show the cases are concentrated in the country’s northeast. Rio de Janeiro State — in the southeast — has had 66 confirmed cases.

Petrobras didn’t immediately respond to a request for comment, nor did the mail service. Apex-Brasil said in an e-mail that it hasn’t been contacted about the sponsorship proposal.

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