Chile’s regions angling for bigger role in infra concessions

Chile’s regional governors want to have a bigger role in the current infrastructure concessions system and eventually develop concessions of their own, although this would require changes to the current legal framework. 

The current concessions law was drafted with large projects in mind and it is not necessarily suited to small or medium-sized initiatives, Javier Hurtado, studies director at the country’s construction chamber (CChC) said.

“We should have a 'regional initiative' concept so that the regions can attract companies" to invest in infrastructure projects, he said during a regional infrastructure management seminar organized by Universidad de Concepción, the association of regional governors (Agorechi) and infrastructure think tank CPI. 

Maule governor Cristina Bravo told BNamericas at the event that there would have to be modifications to the country’s budget law to allow regional governments to launch their own infrastructure concessions. 

“We’re also willing to advance concessions through coordination between private contractors and the public sector,” she said, adding that the US$282mn Maule hospital network PPP is an example of how a lack of coordination between local, national and private sector entities can slow down a project.

“A lot of processes have been hindered because there haven’t been talks between the [public works ministry’s] architecture division, the Maule health service and the concessionaire [Consorcio Iberoasiático],” Bravo said.

Chile held its first ever regional governor elections in 2021, but since then debates have continued over what powers they should have and how much the control the central government should exert.

National government officials have stated that one of President Gabriel Boric’s main objectives is to strengthen regional governments and reduce centralization.

Some regional and municipal authorities have begun to structure infrastructure and water projects, but their scope is far smaller than those prepared by their counterparts in other countries such as Colombia, where, for example, the PPP for Bogotá’s first metro line was tendered by the city government, while in Argentina provincial governments have roadworks departments of their own.