Investments to Reduce Emigration

The execution of five energy and infrastructure projects in Southern Mexico and the Northern Triangle of Central America could boost the area's economic growth and slow migration.

Friday, May 24, 2019

The projects discussed now are not new, they have been part of the discussion of the region's businessmen and governments for years, but now they have come back into the discussion, as a possible response to the pressure exerted by the U.S. to solve the migration problems that mainly affect Guatemala, El Salvador and Honduras.

Among the investments needed to promote economic growth in the Northern Triangle of Central America are the construction of a natural gas terminal in Puerto Cortés, Honduras, and a 300 MW power plant, estimated to cost $1.2 billion.

See “Honduras to Join Mexico-Guatemala Pipeline

Another of the works that Cepal proposes to be carried out jointly with Mexico is the development of a line of electricity connection that will improve the transport of energy for the connection Mexico - Guatemala. Another project is the improvement of the border infrastructure between the North American country and Guatemala, in order to have a direct impact in the Petén area.

The other megaproject is the 710-kilometer railway connection from Ciudad Hidalgo, Chiapas, to the Salvadoran port of La Libertad, with 225 kilometers of railway branches connecting cities in Guatemala, Honduras and El Salvador. Finally, the construction of the gas pipeline between Mexico and Central America, which includes 600 kilometers of connections, which would lower energy costs.

Also see “Will Guatemala-Mexico Freight Train Be Reactivated?

Roberto Sagastume, director of Guatemala's National Agency for Development Alliances (Anadie), told that "... There is a logic that Central America can be incorporated into a whole dynamic of industrial development, competitiveness of Mexico and the United States, which are leading markets. The projects have been identified the different phases, as well as the management of demand risks, acquisition of real estate, and economic and financial risks."

Mariano Diaz, logistics consultant, explained that "... since 2000, initiatives have been proposed, such as the construction of a gas pipeline to connect with Central America, electrical interconnection and an intra-Central American railroad. More than 15 years later, these new projects represent a great opportunity for the countries involved."

The key factor that could give a boost to the execution of these projects is the pressure exerted by the Trump administration. Rubén Hidalgo, an analyst at the Central American Institute of Political Studies (Incep), said that "... in the current context there is great media, economic and security "pressure" from the United States on the immigration issue, especially since the arrival of President Trump."

See articles from "The 5 megaprojects proposed by Cepal that benefit Central America" and "Are AMLO's infrastructure projects viable for Guatemala and the region?”.

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