Air-Ports under the hammer
The process was put on the back burner during the outbreak of Covid-19; but now it has returned to centre stage again. In April 2021 alone five port terminals, including inland waterway hubs, were auctioned off. On top of this the concessions for 22 small and medium-sized airports were awarded, reaping record returns. Brazilian and French players were amongst the winners.
Brazil remains the second-largest Latin American export nation –even with the P1 variant of Covid-19 in Manaus. Reducing state-ownership is a central issue in the transport and logistics sector too (see also ITJ Daily of 4 June 2018). In the shadows of the pandemic the state’s privatisation programme for ports and terminals has advanced in leaps and bounds in the meantime. It’s well known that this issue is at the top of the list of president Jair Bolsonaro’s priorities.
Many projects through to 2022
Now the wave of privatisations is entering a critical phase. In 2021 the Brazilian government wants to hand over 22 port terminals to private operators. Market observers expect strong interest in the invitations to tender. “The port sector is closely linked to the export of agricultural and mining produce. The segment has proved its high degree of resilience during the pandemic,” according to Fernando Fialho, a partner in Modal Consult.
The privatisation programme has registered some success over the past two years, with concessions for 21 terminals awarded. The volume of infrastructure investment came to around BRL 3.5 billion (USD 660 million), with a further BRL 1.4 billion (around USD 265 million) in down payments going to local port authorities or to the Brazilian national government in Brasilia.
Intermodal coups
The auctioneers were extremely busy from mid-April onwards. In just a week the infrastructure ministry Minfra closed deals and signed concession contracts for five port terminals in the northeastern state of Maranhão and the southern state of Rio Grande do Sul. The agreements were worth approximately BRL 216 million (USD 38 million). The lucky winners were the Brazilian port logistician Santos Brasil and Ultrapar in Itaqui, and Chile’s CMCC in Pelotas.
The biggest contract was signed on 7 April, the day that a 30-year concession to operate 22 small and medium-sized airports was awarded; this deal was closed for BRL 3.3 billion (almost USD 600 million). Brazil’s CCR signed up for 15 airports, France’s Vinci Airports corporation for another seven.
The government expects to invite tenders for no less than 57 port terminals in 2022, it says, and simultaneously expects to generate BRL 23 billion (USD 4.4 billion) in investment.
