A portfolio of 105 infrastructure projects worth $1.6 billion, to be developed using public-private partnerships is being promoted among foreign companies.
During the Guatemala Investment Summit the government of Guatemala presented its portfolio of projects to local and foreign investors, in search of options to finance and develop them using public-private partnerships.
A value of more than $5 billion has been given to the investment projects that the Ortega administration intends to carry out through public, private and investment partnership deals.
Among the projects proposed by the Nicaraguan government and open to funding proposals are:
The bill submitted by the Executive aims to increase legal certainty and transparency of processes through improved tender mechanisms.
The Executive presented a bill for public and private investment classified as urgent, only days after the US Congress passed a law whichputs conditions on loans from international institutionsto the government of Daniel Ortega.
A sustained growth of private investment will not be enough to offset the decline in the amount of investment in public infrastructure over the next four years.
On top of the projection of less public infrastructure is an expectation of poor tax collection for the period in question, according to analysis by the firm Indesa. Company projections indicate that "...
Employers point to political instability, energy costs and lack of infrastructure as the main factors keeping out investment and reducing competitiveness.
A survey carried out with employers by the National Association of Private Enterprise (ANEP) showed as its first result the lack of competitiveness of the country in terms of attracting foreign investment, due to uncertainty created by political instability.
The presidents of both countries have signed an agreement to build a $1 billion pipeline which could spread southwards in the future.
Construction of the pipeline, which will cover 600 km connecting Oaxaca in Mexico, with Escuintla in Guatemala, will be completed in a period of four years and will include a gas-fired power plant capable of generating 300 megawatts (MW).
With a loan from the Inter-American Development Bank and through means of public-private investments electricity network coverage will be expanded in rural areas.
From a statement issued by the Inter-American Development Bank (IDB):
"The Inter-American Development Bank (IDB) announced the approval of a loan of U.S. $20 million to Panama to finance a rural electrification program that will encourage public and private investment to provide services to more than 100,000 rural households.
In a period of 20 years, plans are to build a port in the Caribbean, improve roads in productive sectors and organize public transport.
The International Cooperation Agency of Japan (JICA) and the Nicaraguan government have presented a study on the National Transport Plan of Nicaragua. In a period of 20 years, the plan is to build a port in the Caribbean, improve roads in the productive sectors and organize public transport, all at a cost of $8 billion.
The infrastructure and road network built with funding from the Millennium Challenge Corporation should be the focus of new development projects in the area.
An article in ElSalvador.com reports that Jose Angel Quiros, former executive director of Fomilenio, said "I have no information on new projects in the north, but without a doubt thought must be given to how to maximize that infrastructure and road network for the country's productive sectors ... the region's strategic programs north of the country, carried out with the first funds from the Millennium Challenge Corporation (MCC) between 2009 and 2012, must be diversified and enhanced with new works. "
They include the modernization and expansion of the International Airport of El Salvador, the concession for Port of La Union, and the generation of 350 MW of energy, among other things.
From a press release issued by the Presidency of El Salvador:
The President, Mauricio Funes, called today for the creation of a solid alliance involving all of the country's sectors in order to achieve acceptable goals of economic growth, employment generation and equitable distribution of wealth.
Private investment projects taking place in the coastal area of El Salvador will be supplemented by $50 million in additional projects.
An article in Laprensagrafica.com quotes the U.S. ambassador in El Salvador, Mary Carmen Aponte, reaffirming U.S. support through the Millennium Fund.
The ambassador announced yesterday that they "had an approval of a second donation of Millennium funds, this would be accompanied by $50 million to support with additional works investment projects implemented by private companies. 'The public-private partnerships will be very important and FOMILENIO II will have a component of $50 million. Once received the FOMILENIO II the fund will be available to help private enterprise '. "
Despite the enormous potential in gold, nickel, tin and other light metals, the mining sector is not consolidated due to lack of strategic planning and public policies.
A study by the Fraser Institute puts Guatemala in position 74 out of 79 countries evaluated according to the favorability, or not, of the environment for mining. It is a very low position which suggests that it has unattractive conditions for investment.
When construction began in 2008, eastern El Salvador was filled with hope and investment projects, which are now frustrated by a port that does not work.
The port terminal, built at a cost of $200 million and opened in 2010, to date has little maritime activity.
Business groups have spent a lot of money in the business of transporting containers and goods, hotels to accommodate the waves of foreign tourists expected, and there were those who spent large sums on land, warehouses and other buildings. Instead of increasing fortunes, what local investors have experienced is frustration and disappointment. Along with sums contributed by the private sector, are the substantial funds spent by the State which do not helped much either.
President Martinelli has announced that bill no. 349, that would set up a framework for enabling public-private partnerships (PPPs), will be sent back for further discussion.
The announcement was viewed positively by hospital leaders who stopped work on 20 October in protest at the proposed law.
Panama's medical associations oppose the bill, saying that its effect will be to privatize the country's health services, since the proposal includes, "concessions for hospitals to be built, as well as roads, ports and drinking and waste water management systems".
The country's council for development partnerships (Conadie) will be responsible for approving investment and infrastructure projects to be carried out jointly by the government and private sector.
The Ley de Alianzas ("Public Partnerships") law will make it possible for the government to invest jointly with private companies in projects to build roads, shipping terminals, airports, power grid improvements and railways, for example.