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Brazil plans to invest $28bn in ports by 2016

Brazil plans to invest $28bn in ports by 2016
Rio de Janeiro: Brazil plans to invest $28nn by 2016 in the port sector, according to Luciano Coutinho, president of the National Bank for Development (BNDES).

At present, Brazilian ports are facing congestion and increasing demand capacity. To meet these challenges, BNDES could offer loans at special rate of 7.5% interest, Coutinho said.

Brazil's joint congressional committee has approved definitions for the country's port reform bill, known as MP 595, although it is still considering amendments.

Among the main changes yet to be voted on is whether or not to allow for the possibility of 50-year contracts in the form of 25-year concession periods, which would be renewable for a second 25 year period.

Brazil’s congress, both the senate and the house of representatives, must vote on the revised proposal by 16 May at the latest, if not, the proposal will be nullified.

The bill MP 595 allows private ports to handle any kind of cargo, opens pre-1993 public port terminal contracts to private tenders, and allows private operators to handle more third party cargo.

According to the federal government, if passed, it would reduce port costs and is a necessary step towards increasing competitiveness and building Brazil's long-term growth.

Not everyone agrees over the port reform bill. Opponents to MP 595 include local unions who say it will harm dockworkers, and some politicians who believe it would affect the Brazilian states' abilities to autonomously administrate ports.

The port reform bill would cover 159 port terminals; 42 are in new areas, 46 and 71, respectively, have expired contracts or expire by 2017 (of which 42 have no chance to be restarted).

Over 10 years, Brazil plans to invest $3.2bn in public port infrastructure, $1.9bn in dredging, and $1.3bn in land infrastructure access.

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