Driving Greater Road Infrastructure Development

Our bullish view on Colombia's road infrastructure sector has been further confirmed by news that Fiscal Policy Superior Council (Confis) has approved US$13.4bn of financing for nine projects. This is the largest sum ever approved for road infrastructure in the country. With an underdeveloped road system and an increasingly inviting business environment, Colombia offers multiple opportunities for infrastructure investors.

These nine projects are part of the 'Prosperity Highways' programme, which includes 838km of roads, 63km of bridges and 90km of tunnels. It is hoped the infrastructure will connect the fragmented topography of the country.

Eight of these nine highly technical projects will be developed as Private-Public Partnerships (PPP), and will include construction and 25-year concessions for the Conexión Norte (to be awarded at the end of March 2014), Autopista al Río Magdalena 1, Autopista al Río Magdalena 2, Autopista al Mar 1, Autopista al Mar 2, Autopista Conexión Pacífico 1, Autopista Conexión Pacífico 2 y Autopista Conexión Pacífico 3. The remaining project, the Toyo tunnel, is the only one to be fully financed and built by the state. These projects aim to connect the Antioquia department, one of the country's main industrial and agricultural regions, with the country's ports - in order to increase export competitiveness. According to a report from the Treasury, the new roads will reduce the travelling times for trucks to the ports by an average of 40%.

A Long Way To Go
Quality Of Roads Infrastructure Ranking - Selected Countries

Our bullish view on Colombia's road infrastructure sector has been further confirmed by news that Fiscal Policy Superior Council (Confis) has approved US$13.4bn of financing for nine projects. This is the largest sum ever approved for road infrastructure in the country. With an underdeveloped road system and an increasingly inviting business environment, Colombia offers multiple opportunities for infrastructure investors.

These nine projects are part of the 'Prosperity Highways' programme, which includes 838km of roads, 63km of bridges and 90km of tunnels. It is hoped the infrastructure will connect the fragmented topography of the country.

Eight of these nine highly technical projects will be developed as Private-Public Partnerships (PPP), and will include construction and 25-year concessions for the Conexión Norte (to be awarded at the end of March 2014), Autopista al Río Magdalena 1, Autopista al Río Magdalena 2, Autopista al Mar 1, Autopista al Mar 2, Autopista Conexión Pacífico 1, Autopista Conexión Pacífico 2 y Autopista Conexión Pacífico 3. The remaining project, the Toyo tunnel, is the only one to be fully financed and built by the state. These projects aim to connect the Antioquia department, one of the country's main industrial and agricultural regions, with the country's ports - in order to increase export competitiveness. According to a report from the Treasury, the new roads will reduce the travelling times for trucks to the ports by an average of 40%.

A Long Way To Go
Quality Of Roads Infrastructure Ranking - Selected Countries

According to the World Economic forum, Colombia ranks second weakest in South America for quality of roads infrastructure. As such, we believe that the country has a long way to go in order to bridge this transport infrastructure gap and reach regional standards. The enormous potential of Colombia's road sub-sector is confirmed by our Key Project Database, which indicates that more than 58% of projects by value are in the tender stage. As such, we anticipate significant growth this sub-sector in the next five years.

Opportunities Abound
Colombia Road Projects By Value (US$mn)

The aforementioned nine initiatives are just some of the twenty-five road projects that the government plans to award in 2014. In line with our global company strategies, which highlight that numerous European construction companies hope to increase their exposure to Latin America, Spanish firms Sacyr, OHL, Cintra and Ferrovial have expressed interest in investing in these projects. They have been followed by French Vinci, Brasilian Odebrecht and Peruvian Grana Y Montero.

Read the full article

This article is tagged to:
Related sectors of this article: Infrastructure, Transport Infrastructure, Roads and Bridges
Geography: Colombia
×

Enter your details to read the full article

By submitting this form you are acknowledging that you have read and understood our Privacy Policy.