Bloomberg – Argentina is in advanced talks to receive $200 million in financing from the Inter-American Development Bank’s investment arm as it pushes forward with an ambitious highway construction project.
The country has received “a strong commitment” from the multilateral lender and hopes to finalize the details over the next few weeks, Transport Minister Guillermo Dietrich said in an interview at Bloomberg’s headquarters in New York. The funds will go into a trust, administered by the country’s development bank, to finance the early stages of highway projects.
IDB Invest didn’t immediately reply to a request for comment.
President Mauricio Macri has vowed vast improvements to Argentina’s infrastructure by using public-private partnerships to modernize the country as he readies for elections in October. But a 50 percent drop in the peso last year and sky-high interest rates have made it difficult for companies to find financing and slowed down the pace of some projects.
Companies that won contracts for the first wave of six highway projects originally had just one year to secure financing, but received an extension until 2020, according to Manuela Lopez Menendez, the country’s public works secretary. While the exact deadline has yet to be determined, it will probably be in the first half of next year, she added.
Dietrich and Menendez were part of an Argentine delegation that traveled to New York and Washington last week to meet officials from the World Bank, the Overseas Private Investment Corporation, and the IDB. Dietrich, who also participated in a breakfast with investors including Goldman Sachs Group Inc and JPMorgan Chase & Co, said he saw a marked shift in investor sentiment toward the country.
“Back in October, we spent all our time explaining the short-term problems and our confidence that we were taking the right steps,” he said. “Now the talks focus on the elections and the continuation of our plan. We’re amazed by the good vibes we’re getting from multi-laterals, banks and institutions.”
Here’s what’s next in the government pipeline:
- North Patagonia train project, which will connect the shale fields in Vaca Muerta to the port of Bahia Blanca
- The government is in talks with companies as it looks to sell the rights to transport fracking sands
- Officials aim to finish the project by May and then launch a tender process
- A power transmission line tender will be held later this year
- A project to extend three train lines and build a connecting station in the city of Buenos Aires (Red de Expresos Regionales)
- Officials received interest from the World Bank, which may get involved in part of its financing and will travel to Argentina in March to look at the project more closely.