Tuesday, February 7, 2012

Brazil privatises three airports

The Brazilian Government privatised operations at three of the nation's main airports this week, awarding US$14 billion ($16.8 billion) in contracts to three consortiums that will expand and run terminals amid demand ahead of the 2014 World Cup.
Improving airports plagued with bottlenecks, long lines and poor infrastructure was a key promise the Government made in its winning bid to host soccer's premier event. Hundreds of thousands of fans will fly between the 12 host cities for matches.
Brazil's airports have buckled under demand that tripled in the past decade. In 2002, airlines flew 34.3 million passengers on flights originating in Brazil. That rose to 107.8 million last year, Brazil's civil aviation agency reported.
The Government is also expected to auction the rights to run other airports, including Rio de Janeiro's international airport.
Infraero, the state-run agency, retains a 49 per cent stake in the privatised airports, which include the nation's busiest airport in Sao Paulo, along with those in Brasilia and in the city of Campinas in Sao Paulo state.

Together, the three airports are responsible for 30 per cent of Brazil's passenger traffic.
The 20-year contract to operate Sao Paulo's Guarulhos International Airport was won by the Invepar consortium, 90 per cent of which is controlled by Brazil's Investimentos e Participacoes em Infraestrutura SA with the rest in the hands of the Airports Company South Africa.
Completing work on new terminals before the 2014 World Cup is the main challenge for the three consortiums. They will be fined US$87 million plus US$875 million for each day they are late after the cup begins.