NO to Public Private Partnership for Airport

The government of El Salvador has changed his mind regarding a PPP for the expansion of the International Airport, prompting the withdrawal of technical support for the project from the US.

Tuesday, October 13, 2015

According to the Technical Secretary of the Presidency, Roberto Lorenzana, the argument to dismiss the PPP is based on the fact that following this business model would only bring the State rental income for 25 years, while the airport currently receives $40 million a year in net income.

"... One study found that if the expansion was financed in the form of public private partnership, the investor would have to put up $125 million in investment and would keep the administration of the terminal over the next 25 years."

"... 'Do the math ... 25x 40 would not be coming to us, it would not be beneficial for the state," he said. 'And that's why we decided to opt for a way of financing the expansion with equity' he said, referring to a surplus of $20 million from a securitization that was made in previous years. "

"... The US ambassador in El Salvador, Mari Carmen Aponte, confirmed last week that her country withdrew technical support while waiting for the CEPA to define the financing for the expansion of the terminal. 'Put it this way: our goals are no longer aligned to the objectives of CEPA.' "



More on this topic

Private Public Partnership to Expand Airport

October 2017

Through a public-private alliance, Fomilenio plans to make improvements to the cargo terminal at El Salvador's international airport, Monsenor Romero, and in a second phase, to invest $44 million in its expansion.

Fomilenio authorities detailed that they have completed the feasibility studies and determined that the first project to be carried out under the figure of Public - Private Alliance is the extension of the cargo terminal at the International Airport Monsignor Óscar Arnulfo Romero y Galdámez. 

El Salvador: How to Finance Airport Expansion

May 2015

International loans, public-private partnerships and now a securitizations are options that have emerged in recent years to fund the expansion of the capital's airport, which so far have remained on paper.

After raising the idea of a public-private partnership as the best alternative to finance the expansion of the international airport in San Salvador, the Autonomous Executive Port Commission (CEPA) is now indicating that this method "would take two years, which would be 'too long' for this terminal, whose capacity has been exceeded. "

Public Private Partnerships for Infrastructure and Energy

March 2013

The expansion of the International Airport of El Salvador and energy projects are some of the works that the State plans to make in conjunction with private companies.

In reference to the Public-Private Partnerships Bill under study in the Legislature, the Technical Secretary of the Presidency, Alexander Segovia, said there are many infrastructure needs that the state can not meet in the short or long term and in which private enterprises could intervene, "under appropriate legislation."

El Salvador Airport to Invite Private Partners

December 2012

The Goverment of El Salvador has decided that the expansion of the International Airport of El Salvador will be conducted via a public-private association.

The technical secretary of the presidency announced that they decided to use this mechanism due to the “large resources required by the expansion”.

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