Odebrecht to start upgrading Havana airport this month

Brazilian construction giant Odebrecht will begin a project this month to modernize and expand Cuba's main airport in capital Havana, according to press reports.

The expansion project, which has been in the planning stages since at least 2013, begins as the US and Cuba work to normalize relations, inching ever closer to ending the former's economic embargo against the island nation, which has lasted more than 50 years.

Work will focus on Terminal 3 of the José Marti International Airport, Odebrecht's representative in the country, Fabio Goebel, told local online magazine Cuba Contemporánea.

The project, expected to cost US$207mn, is intended to boost efficiency and improve services at the terminal, which handles around 4mn passengers a year.

State-owned company ECASA operates the airport.

Brazil's national development bank BNDES will provide US$150mn in financing for the project, while the Cuban government will cover the remaining US$57mn, Brazilian daily O Estado de São Paulo reported.

BNDES will disburse the loan directly to the Cuban government through an export credit facility the two countries arranged in 2014.

The José Marti upgrade, which also entails minor repair works at four other airports in Cuba, is Odebrecht's third project in the country. In January 2014, the Brazilian company wrapped up a project to expand the Mariel port, which is some 40km west of Havana.

The project, which included the construction of a 1mn TEU/year international container terminal, cost nearly US$1bn, around 70% of which was financed by a BNDES loan.

Odebrecht also signed an agreement in 2013 to manage and upgrade a sugar mill in Cienfuegos province.

In December, the US and Cuban governments announced that they would begin taking steps to renew diplomatic and commercial ties. The two sides are now engaged in discussions to reestablish embassies, while the US Treasury has loosened economic sanctions against Cuba.

The 54-year old trade embargo on the island, however, remains in place, as lifting it requires congressional approval in the US.