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Latino Daily News

Saturday December 7, 2013

Brazil Puts Future Airport Privatizations On Hold

Brazil Puts Future Airport Privatizations On Hold

Photo: Rio de Janeiro airport

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Brazil’s government, which has privatized five major airports in the past two years, has ruled out granting any more new concessions of this type for the time being, the civil aviation chief said Friday.

The remaining airports will continue to be managed by state-run Infraero, the head of the presidential Civil Aviation Office, Wellington Moreira Franco, told a press conference in Rio de Janeiro.

“The first stage of the program set forth by President Dilma Rousseff to modernize airport infrastructure involved (awarding) concessions for the major airports so we could attract big operators and generate a climate of competition that would benefit passengers in terms of prices, quality of service and safety,” he said.

The next stage is to evaluate the concessions that have been awarded and measure their impact, Moreira Franco said.

In a bid to promote regional aviation, the government also plans to invest in 270 airports in medium-sized cities and grant subsidies that reduce the price of air travel at those facilities.

Last month, a consortium led by Brazilian conglomerate Odebrecht was awarded a 25-year concession to operate and maintain Rio de Janeiro’s international airport, the country’s second-busiest.

The Aeroportos do Futuro consortium offered just over 19 billion reais (some $8.6 billion) for the concession, nearly four times the minimum bid price required by the government.

The winning consortium, which also included Singapore airport operator Changi Airport Group, also agreed to make investments totaling 3.5 billion reais (some $1.6 billion) to expand and modernize the airport, popularly known as Galeao.

At the same time, a consortium made up of the operators of the Munich and Zurich airports and Brazilian holding company CCR was awarded a 30-year concession to operate and maintain Belo Horizonte’s Confins international airport, the country’s fifth-busiest.

The Aerobrasil consortium offered 1.8 billion reais (some $827.3 million) for the concession, an amount 66 percent higher than the minimum required bid.

Under the concession rules, Brazilian state-run airport operator Infraero will retain a 49 percent stake in the airports.

Rio de Janeiro will host the 2016 Summer Olympics, while Rio and Belo Horizonte will both be host cities for next year’s soccer World Cup.


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