Four Colombia highway concessions delayed

By
Monday, September 15, 2014

Colombia plans to award the construction of four more highways by November as part of a US$25bn plan to expand and improve road quality and logistics, President Juan Manuel Santos said.

The 1.47tn-peso (US$770mn) Mulaló-Loboguerrero, 960bn-peso Conexión Norte, 2.1tn-peso Río Magdalena 1 and 1.3tn-peso Río Magdalena 2 routes were previously expected to be awarded between August and September.

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Once the contracts are signed, the government will have wrapped up the concessions to build nine highways, the first leg of its 4G plan to build 8,000km of roads. Most of the projects will be carried out under public-private partnerships.

"We have four more [highways] to award ... Those projects will be awarded between now and November," Santos said after signing the contract for a US$1.3bn river navigability project. "We'll finish this year as promised, with the first wave of concessions awarded."

Last week, Colombia signed five highway contracts for 5.8tn pesos, the first under the 4G plan.

The government has eased rules to allow more companies to participate in the tenders, which have attracted few bidders. Insurer AIG said several highways could be difficult to award as traffic estimates for 20-25 projects - out of a total of 40 - were overstated, and anticipated possible financial strains in tenders.

Additionally, the government is looking at banks, multilateral organizations, bonds and infrastructure funds to finance the program.