Peru gears up for infra concessions spree

Tuesday, November 18, 2014

Peru plans to award next year infrastructure concessions including rail and road projects.

Hydro and thermal power plants and liquefied petroleum gas distribution in the capital are also being lined up, a senior government official said.

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Concessions will include a thermal power plant in Quillabamba, in Cusco region, the fourth stretch of the Longitudinal de la Sierra highway, the Huancayo-Huancavelica railway line and the Callao logistics hub (ZAL), said Carlos Herrera, head of state investment promotion agency ProInversión.

The agency will seek to develop private-public partnerships (PPP) with investors from the US, the UK, China, India, South Korea and Australia, Herrera told state news agency Andina.

President Ollanta Humala's government has awarded 27 concessions involving a total investment commitment of US$17.945bn since taking office in July 2011, Herrera said. Peru holds elections in April 2016 and the new government is scheduled to take office on July 28 of that year.

At least US$10bn in concessions has been awarded this year, including line No.2 of Lima's metro system, the southern Andean gas pipeline, thermal power plants, power lines, Pisco port and Chinchero airport.

Peru's economy is expected to grow 3.1% this year compared with 5.8% in 2013. But it will rebound to expand 5.5% next year as the government increases public spending and investment ramps up in infrastructure concessions, according to the central bank.