MercoPress. South Atlantic News Agency

Brazil’s five largest airports will be managed under concession by private sector

Airport infrastructure needs to expanded on time for the 2014 World Cup and 2016 Olympics

Brazil is planning to hand over the country's five largest airports to the private sector through concession agreements, in an effort to accelerate upgrades ahead of two major international events, Brazilian presidential Chief of Staff Antonio Palocci said Tuesday.

The operations and expansion of Brazilian airports have become a key issue in the run-up to the 2014 soccer World Cup, spread among 12 Brazilian cities, and the 2016 Olympic Games, to be held in Rio de Janeiro. There are growing concerns that the airport infrastructure won't be ready to deal with the expected influx of visitors.

The government has approved plans to tender concessions for private sector companies to manage two airports in São Paulo state and one in Brasilia, Mr. Palocci said in a speech in Brasilia to the national economic and development council, which is led by President Dilma Rousseff.

“We want to combine the urgency of the works with public and private investments,” Mr. Palocci said.

The government plans to issue licenses for services at the international airport in the city of São Paulo, along with the Viracopos airport in Campinhas, about 100 kilometers north, and Brasilia’s airport. Palocci didn’t say what kind of model the government will adopt for those airports, such as if the licensees will own or just operate the terminals.

The government is also studying how to offer concessions for airports in Rio de Janeiro and Belo Horizonte, he said.

The government wants to pick up the pace of investments not only to meet demand during the sporting events, but to ensure that capacity meets the country’s air traffic needs.

Brazil needs to invest 25 billion to 34 billion Brazilian Real (16 billion to 21.7 billion US dollars) over the 20 years in order to bring capacity in line with future demand, said Paula Faria, organizer of the first airport infrastructure expo in Sao Paulo.

Current capacity of 130 million passengers needs to more than double, to 310 million during the next two decades, to match air traffic demand growth of as much as 7% a year, she said.