2-Sep-2013 1:40 PM

Brazil President sees raising cap on foreign participation in carriers as best way to aid industry

Brazil's President Dilma Rouseff is reportedly considering raising the cap of foreign investment in Brazilian carriers from its current 20% to "at least" 49% as the best way to aid Brazilian carriers under increasing cost pressures, with a debate reportedly ongoing whether or not to allow majority foreign ownership. According to a Agencia Estado report, the government is now reportedly considering reviving a nine-year-old bill to revise the country's aeronautical code, which is reportedly ready to be voted on in the Chamber of Deputies, which would allow for an increase in foreign capital in Brazilian carriers. Regarding the other proposals recently put forward by TAM Airlines, Gol, Azul and Avianca Brazil, reducing taxes is reportedly seen as difficult in the current budget climate, especially considering the greater public and infrastructure spending demanded by protestors across the country recently, with aid to airlines potentially seen as contentious considering widespread popular demand for public transport improvements. Intervening in fuel costs is also reportedly seen as politically and economically costly.

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