Brazilian government changes rules on concessions
In Brazil, the government has announced a change of rules in respect of its second tranche of port concessions. Instead of the concessionaire being chosen on the basis of the lowest tariff offered to users, winners will be those offering the most money to the government, the so-called “cannon”.
The 21 terminals on offer at various ports are valued at around $2.36bn and will be offered to the market in early 2016.
Ports minister Edinho Araújo says that the new criteria had been requested by the private sector.
Terminals included in this sell off are at the ports of Aratu, Itaqui, Manaus, Rio de Janeiro, Paranaguá, Santana, Santos, São Francisco do Sul, São Sebastião and Suape.
One of the direct beneficiaries of the change in policy will be the Port of Santos authority (Codesp), which will receive much needed additional income compared with the old style of offering concessions. Initially, it was to be the federal government that received the upfront payment; now, this will be given to the port authorities as effective state investment.
In addition to private investors, the Sovereign Fund of Singapore has also recently been linked to port developments in Brazil.
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