Brazil to invest US$ 63 billion for World Cup and Olympics

Between UK£ 10 billion (US$ 16 billion) and UK£ 30 billion (US$ 48 billion) of investment is needed to improve Brazil's infrastructure to prepare for the 2014 World Cup according to a new report, from UK Trade and Investment (UKTI).

Meanwhile, it is expected that around US$ 15 billion will be invested in Rio ahead of the 2016 Olympic Games.

In the report, It's all to play for, infrastructure opportunities in Brazil: FIFA World Cup 2014, UKTI states the Brazilian Government has already established an accelerated growth plan (PAC) aimed at stimulating infrastructure development and boosting economic expansion.

The programme will allocate around UK£ 208 billion (US$ 332 billion) between 2007 and 2010 and an additional UK£ 125 billion (US$ 200 billion) post-2010. By the end of 2009 the Government is expected to define a ‘PAC da Copa', which will outline government funded infrastructure projects to support the delivery of the World Cup 2014.

The Maracanã stadium in Rio will undergo a major refurbishment for the World Cup, costing around UK£ 150 million (US$ 239 million) and it will also stage the opening and closing ceremonies of the 2016 Olympic and Paralympic Games.

Around UK£ 2 billion (US$ 3 billion) will be invested in the Rio's transport system - a rapid bus system around the city will be built and as well as a new metro line which will link the city centre to Barra, where the Olympic and Paralympic Village will be located.

Transport

Modernising and extending Brazil's airports will be a key focus for the country as it prepares to accommodate the two sporting events.

Infraero, the Government agency which operates the country's airports is investing around UK£ 1.5 billion (US$ 2.4 billion) over the next four years to expand and modernise the terminals in readiness for 2014.

Faith Quigley, Brazil specialist for the UKTI, said, "Air travel will be the main transport method for most of the World Cup fans in 2014. The number of passengers using the air network is expected to double during the month of the World Cup from about 4 million to about 8 million but demand for air travel in general is increasing in Brazil at a rate of around +5% a year so any investment is beneficial in the long term development of Brazil as well."

Infraero does not have the resources required to maintain and regenerate the airports if current growth levels are sustained. Therefore, the Government is looking at alternative models to attract private investment, including privatisation, concessions and public-private partnerships PPPs.

Ms Quigley said the Government's ‘PAC da Copa' will address the issue of improving other urban transport systems and although funding has not yet been agreed proposals suggest more than UK£ 10 billion (US$ 16 billion) could be invested in this area during the next few years.

According to Ms Quigley the government has committed to extend and improve the rail network and the Rio to Sao Paulo high speed rail link alone will require UK£ 11 billion (US$ 17.5 billion) of capital investment.

Many of the stadiums built for the World Cup and associated infrastructure will be of benefit to the 2016 Olympic Games.

"In terms of infrastructure of course staging the World Cup two years before the Olympics will be a massive bonus to Rio," Ms Quigley said.