By Ben Tavener, Senior Contributing Reporter

SÃO PAULO, BRAZIL – The Brazilian government is hoping that the concessions announced for the country’s road network will spark a close contest between at least six groups, with as many as twelve companies reported to have expressed an interest, reports Valor business edition. In all, 4,660 miles (7,500km) of federal highways are going to be auctioned over the next three months.

Over sixty percent of Brazilian highways have major problems, particularly potholes, the National Transport Confederation (CNT) revealed in 2012, Brazil News
Over 62 percent of Brazil’s highways had major problems, the National Transport Confederation (CNT) revealed in a 2012 study, photo by Divulgação/CNT.

The six companies reported to be particularly interested are: CCR, Odebrecht, Invepar, Ecorodovias, Triunfo and Acciona.

The first round of concessions is coming up on January 30th, with two routes – the BR-116 in Minas Gerais and the BR-040 from Brasília to Juiz de Fora – will be auctioned.

However, seven stretches set to go under the hammer in April are drawing more interest, when contracts are due to be signed for over 3,540 miles (5,700km) of highway, which will mean private investment of some R$32 billion (US$15.7 billion).

One of the most noticeable differences from motorists, according to Valor, will be an end to long waits at tolls: companies will be forced to raise the toll barriers during busy periods, if traffic waiting to go through the tolls extends further than 200 meters or fifteen minutes’ wait, something already adopted in neighboring countries.

The Agência Nacional de Transportes Terrestres (National Transport Agency, ANTT) is hopeful that the concessions will improve standards for drivers, as well as “promoting innovation,” and that the concessions will go from strength to strength.

The government has stipulated that companies must have a net worth of between R$400-870 million, ruling out smaller companies and stopping the biggest enterprises from taking all the concessions.

The move resulted from past experiences, where companies failed to deliver what they were contractually obliged to provide, and the government is also reported to have been disappointed by the experience of other privatizations, including of three airports in 2012.

Read more (in Portuguese).

* The Rio Times Daily Updates feature is offered to help keep you up-to-date with important news as it happens.


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