Air Cargo Quarterly
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Brazil eyes $12 billion in investments as port law takes effect
Brazilian President Dilma Rousseff signed into law new regulations to make its ports more efficient and attract up to $12 billion in investments as the country begins to tackle logistics bottlenecks hampering vast farm exports.The estimate is the value of planned private sector port projects already submitted to the government for approval, Rousseff’s chief of staff Gleisi Hoffmann said at a media conference to announce last-minute changes to the ports law.The law makes private investment more attractive by allowing private terminals run by commodities traders, for example, to handle cargo for other companies and no longer just the produce linked to their own activities, such as farming or mining.Expanding private sector participation in Brazil’s port operations will increase competition between port operators and result in lower charges for the handling of cargo, the government says.Most of the new investments would be to develop facilities on green field sites outside, but near, established ports, the new regulations stipulate.With the new law in place, Brazil will also auction leases that have expired at 52 areas in the vicinity of its biggest sea port, Santos, and in the northern state of Para by the year’s end, Hoffmann said.Leases at a further 107 areas at ports dotting Brazil’s roughly 5,592-mile (9,000 km) coastline would be auctioned off after January 2014, by which time the contractual terms would be finalized.The government fought hard for several months to push through regulatory changes governing ports that it says are vital to boost efficiency and attract private investment as cargo volumes rise, leading to delays and soaring costs.Dock workers largely backed the law that passed Congress in May. Before that they had staged several short stoppages in protest at previous drafts they argued would leave them worse off and with less job security.Brazil’s highly competitive agriculture sector has been hampered by a spike in transport costs caused by a shortage of trucks and queues at ports that are struggling to digest fast-rising output of corn, soy and other products. Long-awaited investments in rail and waterways are still a few years off.Hoffmann listed parts of the bill vetoed by Rousseff, including automatic renewal of long-standing concessions and a section that fixed the duration of concessions at between 20 and 50 years. A restriction excluding shipping companies from running port terminals in Brazil was also removed, Hoffman said. (Reuters)
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