Luciano Coutinho, the president of the Brazilian Development Bank (BNDES), informed that the institution should finance 21 billion Brazilian reais (US$ 11 billion) of the 34.6 billion reais (US$ 18.5 billion) necessary for construction of the High Speed Train (TAV) connecting São Paulo to Rio de Janeiro, on 518 kilometers (322 miles) of tracks and tunnels.
Coutinho participated in the meeting between representatives of the Federal Government, the private initiative, investment and fostering agencies and the Federation of Industries of the State of São Paulo (Fiesp) to discuss the concession, security and profitability for implementation of the TAV.
According to Coutinho, the government should invest 2.2 billion reais (US$ 1.2 billion) in claiming land and 1 billion reais (US$ 535 million) for the creation of the High Speed Train Company (ETAV), to be used for learning and incorporating the TAV technology.
"ETAV should be a public organization, with good technical qualification, prepared for the learning process for technology transfer to be efficient. This shows the government confidence in the project as, due to its participation, the government's is clearly showing private companies that it is prepared to assume risk."
Apart from that, the government should also repeal 6 billion reais (US$ 3,2 billion) in taxes , which still depends on negotiation, according to the BNDES.
According to the director general at the National Agency for Overland Transport (ANTT), Bernardo Figueiredo, the deadline for completion of the TAV (from Campinas to Rio de Janeiro), with all its elements, is six years, but investors will be free to make proposals to anticipate the completion of stretches. "We believe that the project may be completed in three years and the maximum acceptable will be six," he said.
Figueiredo emphasized that the objective of the project is to reduce the negative impact of road and aerial transportation, creating modern transportation in Brazil to integrate the aerial system, optimizing the use of airports.
The company that wins the tender, in October, should have the TAV concession for 40 years, with the right to tariffs throughout operation. The tendering process should be completed in early 2010 and the signing of the contract is forecasted for May 2010, with works scheduled to begin in the second half of 2010.
The tariff should be half the price of airfares between both capitals, in the economic class. The price of the executive class, however, is not fixed.
According to Figueiredo, initially the TAV should connect Rio de Janeiro to São Paulo and Campinas, later on being extended to Curitiba and Belo Horizonte, but there is interest in expanding the project, creating a medium and high capacity railway transport grid in the country.
ABr