Brazil Will Establish Strict Rules for Airport Concession

By Dialogo
September 27, 2011

The Brazilian Government will set ambitious deadlines and retain its right of veto over projects that will be jointly carried out by the state and private firms to expand local airports in advance of the 2014 soccer World Cup, said Wagner Bittencourt, director of the local civil aviation secretariat.

Brazil announced in May that it would turn to the private sector for help in modernizing airports with heavy passenger traffic in time to complete the renovations before the great sports competition.

The measure was a complete ideological reversal, since it will put an end to the state monopoly on airport management.

Nevertheless, the state-owned firm Infraero, which manages the country’s largest airports, will have a right of veto over “significant and strategic issues” in future joint enterprises, Bittencourt said.

Domestic air traffic in Brazil has been growing at double-digit rates, and the airports are normally packed.

The rights to expand and operate the Brasilia airport and the Guarulhos and Viracopos airports in the state of Sao Paulo will be auctioned off in December. Together, the three airports need investments of 3 billion reais ($1.64 billion).

Work at the three airports is to be completed in late 2013, only months before the start of the World Cup. Last week, the Government said that all the major infrastructure projects planned for the World Cup would be ready on time.