Colombia aims to boost private sector participation in infrastructure projects

The Colombian Government and the Inter-American Development Bank (IDB) have joined forces in an effort to boost private sector participation in infrastructure projects in the country.

A US$14.2 million loan from the IDB is the third stage of a program launched in 1996 to support private participation and concessions in infrastructure at national, departmental, and municipal levels in Colombia.

"The satisfactory execution of the program's first and second stages is due in large part to the strength of the government's commitment as well as technical support from the Bank," IDB's team leader Pablo Guerrero said.

In recent years, said the IDB, Colombia has increasingly thrown open infrastructure projects to all players through a series of mechanisms, including concessions, strategic partnerships, privatizations, and private administration and management of public assets.

However, "it still requires a significant investment effort to develop and modernize its infrastructure," Mr Guerrero added.

In the transportation sector the loan will help to develop technical, legal and financial studies needed to structure mid-size cities' projects with private participation.

The loan is for a 25-year term with a five-year grace period, at a LIBOR-based variable interest rate.