By Paulo Winterstein

SAO PAULO--Brazil's Secretary of Civil Aviation asked the country's national development bank BNDES and civil aviation agency Anac to carry out an extensive study of the financial health of Brazil's airlines to determine what aid, if any, the government can provide, the secretary said Tuesday.

Brazil's airlines have seen costs rise in recent years as the price of jet fuel climbs and the government raises taxes on air travel. The government agreed last year to suspend another planned increase in taxes which would have almost doubled taxes that airlines pay to use airports, after an increase of 150% in taxes the previous year.

Brazil wants to ensure that it has healthy airlines to make use of the airports it is handing over to private operators. The government has already signed over four airports to private hands, and plans to auction operating licenses for two more airports this year. The government has also promised billions of dollars in help to build and expand regional airports to bolster air travel between mid-sized cities.

"We can't make an effort to improve our airport infrastructure, both at the large terminals as well as in regional aviation, if we don't have robust airlines," Wellington Moreira Franco, the secretary of civil aviation, told O Estado de S Paulo newspaper.

In addition to the studies, which the secretary's press office said has no deadline for completion, the government is considering changing rules to allow for more foreign investment in the country's airlines. Foreign investors are limited to holding a stake of 20% in airlines, but Mr. Moreira has said he is open to changing those rules.

The country's leading airlines are also rethinking their market strategy after rapid expansion in supply led to falling profitability. Although Brazilian air travel had been expanding at double-digit rates for the past decade, growth slowed last year to 6.8%. Brazil's biggest carriers, Tam SA, which merged with Chile's Lan SA last year to form Latam Airlines Group (LAN.SN), and Gol Linhas Aereas Inteligentes (GOLL4.BR) have both committed to cutting back on supply by almost 10% in the first half of this year.

To help with the turnaround, Gol--which last year reported a loss of BRL1.5 billion, doubling the previous year's loss of BRL751.5 million--announced this week it planned to spin off its frequent-flyer program, Smiles, and raise BRL1.35 billion which would be used to pay down part of Gol's BRL3.6 billion in net debt.

Write to Paulo Winterstein at paulo.winterstein@dowjones.com

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