São Paulo state legislators approve US$1.1bn PPP for Santos-Guarujá underwater tunnel

São Paulo legislators authorized the state government to advance with the offer of a PPP contact to build a 6bn-real (US$1.1bn) underwater road tunnel between the coastal cities of Santos and Guarujá.

“With the implementation of the project, the crossing between Santos and Guarujá will be done in less than five minutes and will not be susceptible to fog, storm surges or even impacts resulting from ships docking at the port of Santos. This way, we will ensure the fluidity of transport and the safety of users," Rafael Benini, state secretary of investment partnerships, said in a statement.

The project is a joint initiative involving the state and federal governments, Santos Port Authority (SPA) and the private sector.

According to the São Paulo government, 86% of the financing for the project will come in equal parts from the state and federal governments and the rest from the private sector.

The 870m tunnel, the first of its kind in Latin America, will be built at a depth of 21m. An auction for the PPP contract is planned for July 2025, the government said previously. The winner will be responsible for construction, operation and maintenance.

BAHIA STATE 

Separately, the Brazilian senate authorized the Bahia state government to obtain a US$300mn loan from the Inter-American Development Bank (IDB) and Latin American bank CAF.

Senate authorization for states to raise resources from multilateral institutions is mandatory because such loans are guaranteed by the federal government.

Of the total, US$150mn will be obtained from CAF and proceeds will be used for the construction of a bridge between state capital Salvador and the island of Itaparica.

The other US$150m from IDB will be used to expand access to and quality of health services in Bahia.