Paper: Ministry studies Megaconcesion trust fund creation

Uruguay's transport and public works ministry (MTOP) has started studying the creation of a trust fund to finance works that fall under the highways and bridges Megaconcesion concession, El Pais reported. The national development corporation CND, a private entity that helps support and manage projects that promote investment in the country, operates Megaconcesion through Corporacion Vial del Uruguay (CVU) that won the US$450mn, 15-year contract in 2001. Under this scheme, pension funds would invest in works and have their investment guaranteed from toll proceeds. Pension fund executives expressed interest in the financing proposal following a meeting with CVU representatives last month, said the report, citing government sources. The report added that according to the sources, at least 23 bidding processes totaling US$33mn are on standby as the government is behind on payments to the CVU. Sources connected to the concession project and cited by El Pais said that although the economy and finance ministry has earmarked US$18mn to the Megaconcession this year, the tender processes will remain frozen until the project has a guaranteed, stable financial flow. Last August, El Pais quoted CND VP Julio Gemelli as saying that because the conditions did not exist to issue US$70mn in bonds to finance Megaconcesion works, talks were underway with institutional investors to find new financing sources. The concession entails building and maintaining 1,272km of roads and bridges of the national highway network.