Constructora Meco, V&T S.A., Ingeniería REC and Constructora Rodsa are some of the companies that in 2018 were awarded contracts to build public infrastructure works in Central America.
An analysis compiled by the Trade Intelligence unit at CentralAmericaData provides data on the companies that during the last year were awarded by the governments of the region, with contracts to execute construction works in Central American countries.
In the first six months of the year, government entities from the countries of the region submitted 73 environmental impact studies for the construction of different public infrastructure projects.
The interactive platform "Construction in Central America", from the Trade Intelligence Area of CentralAmericaData, provides the updated list of public and private construction projects that present the environmental impact studies (EIA) to the respective institutions of each country.
The government of Costa Rica has authorized the execution of resources for the road renovation of 270 km of roads and drainage systems starting in the first half of 2019.
The Ministry of National Planning and Economic Policy (Mideplan) approved the execution of the second stage of the Cantonal Road Infrastructure Program (PRVC II), which should be implemented in five years through 110 projects that will improve 270.8 km of cantonal roads and drainage systems.
In Costa Rica, the brand-new Alvarado administration faces the challenge of solving complex problems such as the growing fiscal deficit, deteriorated infrastructure and high production costs which are affecting the competitiveness of companies.
The Costa Rican - North American Chamber of Commerce (AmCham) shared criteria of "...
The controversy generated by the UNOPS's decision to prevent access to files on the road works for which it is responsible has led the government to refrain from granting new projects in the future.
Possibly as a result of the refusal of the United Nations Office for Project Services (UNOPS) to make public the project files and the subsequent cancellation of contracts by the Comptroller General, the Ministry of Public Works has decided not to continue with the assistance of the international organization in future projects.
In August 2017, 36 environmental impact studies were submitted in the centralamerican countries to build sewer systems, roads and government offices, among other things.
Data from the interactive platform "Construction in Central America", compiled by the Business Intelligence Unit at CentralAmericaData:
Details of the ten most important public infrastructure construction projects in terms of investment, for which environmental impact studies were presented in the last year.
Of the 10 most important public construction projects for which Environmental Impact Studies (EIAs) were submitted to the respective authorities in Central American countries between August 2016 and July 2017, the most noteworthy are three that are to be developed in Costa Rica, with an estimated total investment of $437 million.
The OECD has warned that "underinvestment" in infrastructure is a critical element that inhibits the country's ability to trade.
An analysis of the degree of market opening by the Organisation for Economic Co-operation and Development (OECD), showed positive and negative results, with the most noteworthy among the favorable being an annual increase of 9% in the volume of exports of goods between 1994 and 2013 and a reduction in tariffs and negotiation of free trade agreements.
Deficiencies in the regulatory framework, lack of political will and public capacity to plan and monitor partnerships are the reasons why this model of financing has not been used more fully in the country.
A report called Infrascope, prepared by The Economist Intelligence Unit and FOMIN at the World Bank outlines the reasons why the legal concept of partnerships between state agencies and private businesses is not thriving in Costa Rica.
In Costa Rica new investment funds for development projects are a good alternative to remedy the serious deficiencies in public infrastructure affecting the country.
From a report by Fitch Ratings Central America:
Fitch Ratings - San Jose - (August 24, 2016): The rules on investment funds in Costa Rica incorporate the concept of Investment Funds for Development Projects (FDP) as an alternative to expand financing options (via placement of shares from an FDP).This type of fund can be used in public and private infrastructure projects, as well as in real estate developments (whether they are residential or commercial ones), among other projects.
As the country suffers from a serious crisis of inability to develop public works, one Costa Rican company is helping build the Panama Canal and highways and another infrastructure works in other countries.
EDITORIAL
Costa Ricans do not lack capacity to design and implement large infrastructure projects.One example that confirms this is the participation of MECO in building the third set of locks of the Panama Canal and major roadworks in Colombia.
There is a risk to democracy when liberal state corporatism goes as far as to evade the rules of competition in order to benefit the gigantism of public enterprises.
EDITORIAL
An editorial published by Nacion.com reports on how the Ministry of Public Works and Transport (MOPT) is insisting on giving contracts to the state run Instituto Costarricense de Electricidad (ICE), this time to run supervisory tasks in a road building project.
A publication by the CAF reviews the development of five projects implemented using the public-private partnership model for infrastructure investment in Latin America.
From the Presentation document by the Development Bank of Latin America (CAF):
In recent decades, many Latin American countries have launched public-private partnership projects for the construction, maintenance and operation of public infrastructure.
China Harbour Engineering Company, one of the bidders in the tender for Line 2 of the Panama Metro and a contractor for road works in Costa Rica, is ineligible to participate in projects financed by the World Bank.
Given the criticisms over its main involvement (60%) in one of the consortia which submitted bids for the construction of the Panama Metro Line 2, a spokesperson for China Harbour Engineering Company (CHEC) Latin America argued that "..
Of the $200 million from the IDB and which has been available since 2011 for municipal road infrastructure works, up until December 2014 only $29 million has been utilised.
So far, only 14 projects have been completed, a further 43 have been awarded, 102 are in process and 134 are awaiting development. All municipalities can access funds from loans granted by the IDB, however, 10 cantons have not submitted any projects to tender.