Building a New Continent: A Regional Approach to Strengthening South American Infrastructure

"UILDING A .EW #ONTINENT ! 2EGIONAL !PPROACH TO 3TRENGTHENING 3OUTH !MERICAN )NFRASTRUCTURE

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"UILDING A .EW #ONTINENT ! 2EGIONAL !PPROACH TO 3TRENGTHENING 3OUTH !MERICAN )NFRASTRUCTURE

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#ONTENTS ))23! %XECUTIVE 3UMMARY 7HY ))23!

7HAT )S ))23! ))23! IN !CTION 4HE ))23! h#ONSENSUS !GENDAv OF 0RIORITY 0ROJECTS ))23! AND THE .EW $YNAMICS OF A #ONTINENT ))23! AND THE )$" #ONCLUSIONS (OW TO $O "USINESS WITH THE )$" -ACROECONOMIC )NDICATORS OF 3OUTH !MERICA )NDICATORS

4HE "RIDGE OVER THE !CRE 2IVER LINKING 0ERU AND "RAZIL INAUGURATED ON *ANUARY

WAS THE lRST ))23! PRIORITY PROJECT TO BE COMPLETED

))23! %8%#54)6% 35--!29 2EGIONAL INTEGRATION IS UNLOCKING NEW FORCES IN ,ATIN

INVESTMENT STRATEGIES WHILE PROGRESSIVELY HARMONIZING THEIR

!MERICA $EMOCRACIES IN THE REGION HAVE INCREASINGLY WORKED

REGULATORY STRUCTURES 5NDER THE ))23! UMBRELLA 3OUTH

TOWARDS REGIONAL INTEGRATION REDUCING TARIFFS EXPANDING TRADE

!MERICA FOR THE lRST TIME HAS ACTED AS A SINGLE INTEGRATED

AND CROSS BORDER INVESTMENT AND TAKING A MULTILATERAL APPROACH

UNIT TO DEVELOP A PORTFOLIO OF INFRASTRUCTURE PROJECTSˆCOVERING

TO ACHIEVE ECONOMIES OF SCALE AND EFlCIENCY )N 3EPTEMBER

TRANSPORTATION ENERGY AND COMMUNICATIONSˆTHAT FORMS THE

THE HEADS OF STATE OF 3OUTH !MERICAN COUNTRIES TOOK

CORE OF CONVERTING A REGIONWIDE VISION FOR PHYSICAL INTEGRATION

A MAJOR STEP FORWARD LAUNCHING THE )NITIATIVE FOR THE )NTEGRATION

INTO A REALITY /F THE PROJECTS IN THE PORTFOLIO REQUIRING A

OF 2EGIONAL )NFRASTRUCTURE IN 3OUTH !MERICA ))23! AND OPENING

TOTAL INVESTMENT OF 53 BILLION THE ))23! NATIONS HAVE

A BROAD NEW CONTINENTAL APPROACH FOR GREATER INVESTMENT

ASSIGNED PRIORITY TO PROJECTS AS PART OF A hCONSENSUS AGENDA v

AND HARMONIZATION OF ECONOMIC REGULATIONS AND PROCEDURES

4HE FULL LIST OF PROJECTS CAN BE FOUND ON THE ))23! WEBSITE AT

3INCE THEN MUCH TECHNICAL WORK AND POLITICAL ALIGNMENT HAVE

WWW IIRSA ORG WHILE THE LIST OF THE PRIORITY PROJECTS MAY BE

BEEN ACCOMPLISHED TO STRENGTHEN THE INITIATIVE WHICH HAS

FOUND ON PAGE OF THIS PUBLICATION ! LIST OF ))23! PROJECTS

ENJOYED THE SUPPORT OF SUCCESSIVE ELECTED HEADS OF STATE

OFFERING INVESTMENT OPPORTUNITIES CAN BE FOUND ON PAGE

3UPPORT FOR REGIONAL INTEGRATION HAS STRENGTHENED AS NEW TRADE

))23! GOES BEYOND PHYSICAL WORKS

OPPORTUNITIES OPENED UP AND ECONOMIC STABILITY TOGETHER WITH PERIODIC ELECTIONS BROUGHT A NEW EMPHASIS ON RESPONDING TO THE NEEDS OF THE MAJORITIES IN EACH COUNTRY 'REATER INTEGRATION AND OPENNESS HAVE ALSO CREATED NEW OPPORTUNITIES FOR REGIONAL COMPANIES WHICH HAVE INCREASINGLY INVESTED ACROSS BORDERS IN MANUFACTURING AS WELL AS IN SERVICES AND INFRASTRUCTURE

))23! GOES BEYOND PHYSICAL WORKS #OMPLETION OF THE ))23!

))23!

ALREADY WITH A SUBSTANTIAL PORTFOLIO OF ACTIVE

INVESTMENTS WILL HAVE A SUBSTANTIAL IMPACT ON THE ECONOMY OF

PROJECTS IS NOW ONE OF THE MOST DYNAMIC AND AMBITIOUS

THE REGION CONTRIBUTING TO GAINS IN COMPETITIVENESS AND SOCIAL

REGIONAL INTEGRATION INITIATIVES UNDERTAKEN IN THE 7ESTERN

DEVELOPMENT AND CREATING NEW OPPORTUNITIES FOR THE POPULATION

(EMISPHERE !S PROJECTS ARE IMPLEMENTED THEY ARE CREATING

4HIS IMPACT WILL BE MULTIPLIED BY THE BENElTS FROM OTHER IMPORTANT

SIGNIlCANT NEW INVESTMENT AND DEVELOPMENT OPPORTUNITIES

ASPECTS OF ))23! ACTIVITIES THAT GO BEYOND THE CONSTRUCTION OF

0ARTICIPATING NATIONS ARE COORDINATING THEIR PLANNING AND

PHYSICAL WORKS 4HESE ACTIVITIES INCLUDE EFFORTS TO HARMONIZE

OF THE MAIN LIMITS ON BOTH ECONOMIC AND SOCIAL INTEGRATION )N PARTICULAR BETTER PHYSICAL INFRASTRUCTURE IS AN IMPORTANT TOOL TO CREATE NEW OPPORTUNITIES FOR POPULATIONS IN THE POOREST MOST ISOLATED AREAS FACILITATING THEIR INTEGRATION IN THE REGIONAL ECONOMY AND EQUALIZING THEIR ACCESS TO MARKETS 4HE )NTER !MERICAN $EVELOPMENT "ANK )$" HAS BEEN A lRM SUPPORTER OF ))23! FROM THE ONSET 4HE "ANK IS JOINING WITH PARTNERS TO lNANCE BOTH PUBLIC AND PRIVATE SECTOR PROJECTS THAT ARE PART OF THE INITIATIVE AND IS CONTRIBUTING TO THE DESIGN AND ENFORCEMENT OF WORLD CLASS ENVIRONMENTAL AND SOCIAL STANDARDS 4HE "ANK HAS ALSO DEVELOPED INNOVATIVE SYSTEMS TO SUPPORT THE REGULATIONS ACROSS THE REGION IMPROVE CROSS BORDER TRAFlC

INTRODUCTION OF NEW STANDARDS IN PROJECT IMPLEMENTATION AND

REMOVE ADMINISTRATIVE BOTTLENECKS AND PROVIDE AN INFRASTRUCTURE

MONITORING 4HE "ANK IS INVOLVED IN THE lNANCING OF ONE THIRD OF

OF SERVICES SUCH AS FACILITATING EXPORTS BY SMALL AND MEDIUM

THE PROJECTS IN ))23! S PRIORITY PORTFOLIO OF PROJECTS

SIZED ENTERPRISES THROUGH THE REGIONAL POSTAL SYSTEM ))23!

EMPHASIZES ENVIRONMENTAL AND SOCIAL SUSTAINABILITY AS WELL AS

4HE UNSHAKABLE COMMITMENT OF THE )$" TO ))23! IS

lSCAL RESPONSIBILITY REmECTED IN A STRUCTURED PROCESS OF SELECTION

PARTICULARLY IMPORTANT BECAUSE THE TIME IS RIPE FOR

IMPLEMENTATION MONITORING AND EVALUATION OF PROJECTS THAT ALSO

INFRASTRUCTURE INVESTMENT IN 3OUTH !MERICA 4HE REGION IN

TAKES INTO ACCOUNT THE COMBINED EFFECT OF SUCH PROJECTS IN THE

RECENT YEARS HAS BENElTED FROM A STRONG UPSWING IN THE ECONOMY

FRAMEWORK OF THE COMPLETE PORTFOLIO AND ITS TERRITORIAL IMPLICATIONS

4HE EFFECTS OF THIS CYCLE HAVE BEEN REINFORCED BY REFORMS

FOR THE REGION

UNDERTAKEN IN THE PAST YEARS THAT IN MANY COUNTRIES CONTINUE TO YIELD POSITIVE RESULTS -OST COUNTRIES IN THE REGION HAVE COMPLETED AN ELECTION CYCLE THAT REAFlRMED THE STRENGTH OF DEMOCRACY AND

(IGH TRANSPORTATION COST LIMITS GROWTH AND SOCIAL INTEGRATION

THE ATTENDANT NEED OF GOVERNMENTS TO CREATE OPPORTUNITIES AND DELIVER ECONOMIC GROWTH AND SOCIAL SERVICES TO THE MAJORITY OF THEIR CITIZENS WITHOUT COMPROMISING lSCAL RESPONSIBILITY AND MEDIUM TERM ECONOMIC STABILITY 4HESE DEVELOPMENTS PRESENT AN OPPORTUNITY FOR A RENEWED FOCUS ON IMPROVING THE QUALITY OF PUBLIC EXPENDITURE AND ON ENHANCING INFRASTRUCTURE INVESTMENT 4HIS IS ESPECIALLY MEANINGFUL NOW BECAUSE THE PRODUCTIVE USE OF RESOURCES IN GOOD TIMES WILL HELP THE REGION WEATHER AN EVENTUAL

SLOWDOWN OF THE WORLD ECONOMY 4HE )$" CONTINUES TO CONTRIBUTE 4HE CORE OBJECTIVE OF ))23! OF ENHANCING PHYSICAL

TO EFFECTIVE DEVELOPMENT IN THE REGION IN A TIMELY WAY THROUGH

INFRASTRUCTURE HAS IMPORTANT SOCIAL IMPLICATIONS 0HYSICAL

THE lNANCING OF STUDIES AND PROJECTS CARRIED OUT BY THE PUBLIC

INFRASTRUCTURE SERVES AS A PLATFORM FOR REGIONAL GROWTH AND

AND PRIVATE SECTORS AS PART OF ))23!

AS WELL AS BY lNANCING OTHER

COMPETITIVENESS (IGH COSTS FOR TRANSPORTATION ENERGY AND OTHER

PROJECTS IN MEMBER COUNTRIES AND HELPING TO REDUCE BARRIERS TO

SERVICES ASSOCIATED WITH INSUFlCIENT INFRASTRUCTURE ARE SOME

TRADE INVESTMENT AND GROWTH

7(9 ))23!

(ISTORICAL 0ERSPECTIVE +EY 2OLE OF 4RADE AND )NFRASTRUCTURE

,ATIN !MERICA HAS A STRONG TRADITION OF TRADE THAT BEGAN WELL BEFORE THE ARRIVAL OF %UROPEANS #OMPLEX COMMERCIAL WEBS IN THE !NDEAN REGION DATING BACK THOUSANDS OF YEARS ARE WELL DOCUMENTED AND ARE PRIME EXAMPLES OF HOW TRADE CAN IMPROVE THE GENERAL WELFARE 4RADE BETWEEN THE 0ACIlC COAST AND THE MOUNTAIN AREAS IN THE NORTHERN !NDES FOR INSTANCE SUSTAINED SEVERAL CIVILIZATIONS WHOSE ACHIEVEMENTS IN ART AGRICULTURE AND FOOD TECHNOLOGY WERE SUBSTANTIAL 4HESE CIVILIZATIONS WOULD NOT HAVE BEEN POSSIBLE WITHOUT TRADE SINCE THE COAST IS ARID AND THE HIGHLANDS DID NOT PROVIDE FOR ALL THE NEEDS OF A LARGE POPULATION SEE "OX PAGE

NOT NEEDED TO EXPORT GOLD AND MOST AGRICULTURAL PRODUCTION WAS LOCATED NEAR THE COAST 4HIS PATTERN STARTED TO CHANGE IN THE TH CENTURY AS RAILROADS ALLOWED AGRICULTURE TO DEVELOP FARTHER FROM THE COAST 4HE IMPACT OF THE DEVELOPMENT OF SUCH AN INFRASTRUCTURE IS WELL ILLUSTRATED IN THE CASE OF !RGENTINA WHICH GREW IN IMPORTANCE AS AN EXPORTING NATION QUICKLY BECOMING ONE OF THE RICHEST ECONOMIES IN THE WORLD #ONTEMPORARY INVESTMENTS IN RAILROADS AND OTHER INFRASTRUCTURE ALSO HAD A SIGNIlCANT IMPACT ON OTHER COUNTRIES SUCH AS "OLIVIA AND #HILE -ORE RECENTLY THE OPENING OF ROADS ACROSS "RAZIL S CENTRAL REGIONS FROM TO MADE IT POSSIBLE TO TRANSFER THE NATIONAL CAPITAL TO "RASÓLIA BETTER DISTRIBUTE LARGE SEGMENTS OF THE COUNTRY S INDUSTRY AND OPEN UP VAST NEW MARKETS FOR AGRICULTUREˆTHEREBY ENABLING "RAZIL TO BECOME A MAJOR WORLD EXPORTER OF GRAINS MEAT AND OTHER FOODSTUFFS AS WELL AS TO REBALANCE ITS GROWTH PATTERN SEE 4ABLES AND

7HILE TRADE CONTINUED TO BE THE LIFEBLOOD OF THE REGION EXPANDING INFRASTRUCTURE HAS BEEN INSTRUMENTAL IN PROMOTING ECONOMIC CHANGE %XTERNAL TRADE SUSTAINED THE 3PANISH AND 0ORTUGUESE %MPIRES FOR YEARS ALTHOUGH LARGE HIGHWAYS WERE NOT DEVELOPED 4HEY WERE

4ABLE 4OP %XPORTERS IN 3OYBEANS AND -AIZE

4ABLE 4OP %XPORTERS IN #HICKEN AND "OVINE -EAT

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3OURCE &!/34!4 &!/ 3TATISTICS $IVISION !UGUST

3OURCE &!/34!4 &!/ 3TATISTICS $IVISION !UGUST

3UCCESSFUL DEMOCRATIZATION HAS CREATED A NEW DEMAND FOR INFRASTRUCTURE $EMOCRATIZATION HAS HELPED BRING THE COUNTRIES IN THE REGION CLOSER TOGETHER FOSTERING A DESIRE FOR ECONOMIC AND POLITICAL INTEGRATION AND RAISING THE AWARENESS OF THE IMPORTANCE OF INFRASTRUCTURE TO ACHIEVE THIS GOAL )N ADDITION IT SPURRED THE PERCEPTION THAT INVESTMENTS IN INFRASTRUCTURE ARE OF PARTICULAR HELP FOR THE MARGINAL REMOTE AND POOR COMMUNITIES 4HESE CONSIDERATIONS BECAME INCREASINGLY RELEVANT TO MANY LEADERS AS DEMOCRACY NURTURED DECENTRALIZATION AND GAVE A LARGER ROLE TO A BROADER SEGMENT OF THE POPULATION )T WAS RECOGNIZED THAT INVESTMENT IN INFRASTRUCTURE REDUCES THE RISK OF THESE COMMUNITIES BEING PRICED OUT OF THE MAINSTREAM ECONOMY BECAUSE OF HIGH

.EW 2EALITIES )NTEGRATION )NFRASTRUCTURE AND $EMOCRACY 3OUTH !MERICA IN THE PAST YEARS HAS ACCELERATED TRADE LIBERALIZATION BOTH AT THE REGIONAL AND WORLD LEVELS /NE COMPELLING REASON FOR THIS TREND HAS BEEN THE REGION S REASSESSMENT OF THE IMPORT SUBSTITUTION MODEL THAT GUIDED ECONOMIC POLICIES FROM THE S THROUGH THE S )N THE PAST YEARS AN INCREASING NUMBER OF POLICYMAKERS IN THE REGION HAVE ACKNOWLEDGED THE INEFlCIENCIES ASSOCIATED WITH THAT MODEL

ESPECIALLY APPLIED AT COUNTRY LEVEL 4HESE INADEQUACIES AROSE FROM SMALL SCALE

INWARD LOOKING INCENTIVES AND A LACK OF COMPETITIONˆCHARACTERISTICS TYPICAL OF CLOSED ECONOMIES THAT WERE EXACERBATED IN A REGION OF LARGE EXPANSES AND RELATIVELY LOW POPULATION DENSITY 4ABLE

3UCCESSFUL DEMOCRATIZATION HAS CREATED A NEW DEMAND FOR INFRASTRUCTURE

TRANSPORTATION OR COMMUNICATION COSTS )T IS ALSO CRUCIAL TO ENSURE THE HIGHER PRODUCTIVITY NEEDED TO KEEP THE REGION COMPETITIVE AND REDUCE THE LOW INCOME POPULATION &IGURE )MPROVED INFRASTRUCTURE ALLOWS REMOTE COMMUNITIES AS WELL AS THE OVERALL POPULATION

TO BE INTEGRATED INTO THE REGIONAL AND WORLD ECONOMY AND TO BENElT EFFECTIVELY FROM THE OPPORTUNITIES AND INCOME TRADE CAN GENERATE 7HILE THE PROFOUND ECONOMIC ADJUSTMENTS UNDERGONE BY THE REGION IN THE LAST YEARS MAY HAVE TEMPORARILY DAMPENED THE ABILITY OF GOVERNMENTS TO RESPOND TO THESE DEMANDS THE RECENT IMPROVEMENT IN THE OVERALL ECONOMY OF THE REGION OPENS NEW OPPORTUNITIES TO THESE COUNTRIES

!S COUNTRIES STARTED TO LOOK BEYOND THEIR BORDERS FOR INCREASED TRADE AND INTEGRATION A NEW REALITY EMERGED )N PARTICULAR COUNTRIES BEGAN TO SEE SIGNIlCANT BOTTLENECKS IN INFRASTRUCTURE AND WIDE DISPARITIES IN INSTITUTIONAL FRAMEWORKS DIFlCULTIES COMPOUNDED BY NATURAL BARRIERS THAT INCLUDED VAST DISTANCES AND THE WORLD S LONGEST RIVERS AND MOUNTAIN CHAIN

&IGURE 0OPULATION ,IVING ON ,ESS 4HAN 53 A $AY n 3ELECTED 3OUTH !MERICAN AND !SIAN #OUNTRIES

3OURCE 7ORLD $EVELOPMENT 2EPORT

!RGENTINA "OLIVIA "RAZIL #HILE #OLOMBIA %CUADOR 0ARAGUAY 0ERU 5RUGUAY #HINA )NDIA )NDONESIA 0HILIPPINES 4HAILAND

"OX )NFRASTRUCTURE AND 4RADE IN THE #RADLE OF 3OUTH !MERICAN #IVILIZATION .ATIVE !MERICANS DEVELOPED INFRASTRUCTURE TO SUPPORT CULTURES AND CIVILIZATIONS OF HIGH SOPHISTICATION IN 3OUTH !MERICA THAT GO BACK MORE THAN YEARS %XISTING LONG BEFORE THE WELL KNOWN )NCA %MPIRE THE -OCHE AND #HIMU PEOPLES ARE GOOD EXAMPLES OF THIS SEQUENCE OF CULTURES THAT THRIVED IN THE NORTHERN !NDES AND CULMINATED WITH THE )NCAS IN THE CENTURIES BEFORE THE ARRIVAL OF THE )BERIANS IN THE 7ESTERN (EMISPHERE )NFRASTRUCTURE AND TRADE WERE THE BASIS OF THE LIVELIHOOD OF THE -OCHE PEOPLES WHO LIVED IN A MILE STRETCH OF DESERT IN NORTHERN 0ERU BETWEEN THE !NDES AND THE 0ACIlC 4HE SIZE OF THE MOST FAMOUS -OCHE RUINS DATING BETWEEN " # AND ! $ INDICATES THAT SOME VILLAGES WERE HOME TO MORE THAN INHABITANTS 4HESE PEOPLE LEARNED TO DIVERT THE mOW OF THE RIVERS FROM THE HEADWATERS IN THE !NDES TO FORM INTRICATE AND LUSH IRRIGATED VALLEYS WHERE THEY RAISED CORN BEANS SQUASH AND PEANUTS 4HEIR CULTURE IS ALSO WELL KNOWN FOR GOLD TURQUOISE AND STONE ARTIFACTS THAT ARE BREATHTAKING BOTH IN THEIR INTRICACY AND THEIR DETAIL -ATERIALS USED IN CRAFTS AND FOOD WERE IMPORTED FROM AS FAR AWAY AS TODAY S %CUADOR AND #HILE WHERE -OCHE ARTIFACTS HAVE ALSO BEEN FOUND INDICATING THE SCOPE OF THEIR TRADE NETWORK 4HE SUCCEEDING #HIMU %MPIRE FURTHERED THESE ACHIEVEMENTS AS WITNESSED BY THE RUINS OF THE CITY OF #HAN #HAN WITH ITS VAST BUILDINGS VAULTS AND CHANNELS 4HE )NCA %MPIRE CENTERED IN #UZCO 0ERU EMERGED BY THE TH CENTURY ! $ !T ITS HEIGHT IT MAINTAINED AN IMPRESSIVE NETWORK OF MORE THAN KILOMETERS OF ROADS CROSSING THE !NDES AND REACHING INTO PARTS OF WHAT ARE NOW !RGENTINA #HILE #OLOMBIA AND %CUADORˆDISTANCES THE EQUIVALENT OF THAT BETWEEN ,ISBON AND -OSCOW WELL BEYOND THOSE STRETCHED BY EMPIRES OF THAT TIME 4RADE

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IN GOODS AND EXCHANGES OF INFORMATION WERE CONDUCTED OVER THOSE LANES

4ABLE #OMPARATIVE )NDICATORS OF 3ELECTED 3OUTH !MERICAN AND !SIAN #OUNTRIES 6!2)!",%3

!RGENTINA

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%XPORTS OF GOODS AND SERVICES OF '$0

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&OREIGN DIRECT INVESTMENT NET INmOWS OF '$0

3OURCE 3)-! 7ORLD "ANK AND 5.$0 (UMAN $EVELOPMENT 2EPORT

#ROSS COUNTRY COORDINATION IS OFTEN A KEY INGREDIENT FOR TRANSBORDER PROJECTS -ORE INFRASTRUCTURE INVESTMENT CAN PROLONG THE CURRENT ECONOM IC BOOM WHILE HELPING TO IMPROVE SOCIAL INDICATORS #HANNELING INCREASED PUBLIC AND PRIVATE REVENUES INTO HIGH QUALITY INFRASTRUCTURE INVESTMENT CAN ACCELERATE GROWTH AND REDUCE POVERTY PROVIDING AD DITIONAL MOMENTUM TO THE REGION 4HIS PERCEPTION IS SUPPORTED BY A GROWING BODY OF EMPIRICAL STUDIES THAT SUGGEST THAT THE IMPACT OF IN FRASTRUCTURE ON GROWTH CAN BE FAIRLY LARGE 3OME STUDIES SPONSORED BY THE 7ORLD "ANK CONCLUDE THAT THE hINFRASTRUCTURE SLOWDOWNv OF THE PAST TWO DECADES WHICH CONTRASTS WITH THE INCREASE IN EXTERNAL TRADE IN THE REGION &IGURE ACCOUNTS FOR AS MUCH AS ONE THIRD OF THE DIFFERENCE IN

GROWTH IN %AST !SIA COMPARED WITH ,ATIN !MERICA 4HE SOCIAL BENElTS OF GREATER INFRASTRUCTURE INVESTMENT MAY INCLUDE THE CREATION OF NEW JOBS BECAUSE OF THE LOWER COST OF LONG RANGE TRANSPORTATION GREATER ACCESS TO HEALTH AND EDUCATION OR ELECTRIlCATION IN REMOTE AREAS #ROSS COUNTRY COORDINATION IS OFTEN A KEY INGREDIENT FOR TRANSBORDER PROJECTS 4HESE PROJECTS ARE INTRINSICALLY MORE COMPLEX THAN PURELY NATIONAL INITIATIVES 4HE COSTS BENElTS AND IMPACTS OF A CROSS BORDER INVESTMENT TYPICALLY ARE DIFFERENT FOR THE COUNTRIES INVOLVED $ECISIONS ON DESIGNING AND UNDERTAKING THE PROJECT NEED TO RESOLVE ASYMMETRIES OF lSCAL AND REGULATORY CAPACITY COASTAL ACCESS AND OTHER GEOGRAPHIC CHALLENGES POPULATION INCOME LEVELS AND NATIONAL PRIORITIES 0ROJECTS THAT FACE THESE KINDS OF COMPLEX CHALLENGES REQUIRE TRANSNATIONAL AGREEMENTS INTRAREGIONAL COORDINATION AND NONTRADITIONAL lNANCING SCHEMES 4HEY NEED A COMMON INSTITUTION THAT ENABLES COUNTRIES TO AGREE ON HOW TO DETERMINE AND SHARE THE INVESTMENT COSTS HOW TO PRICE THE SERVICES AND HOW TO COORDINATE ACTIVITIES )N SHORT THEY NEED ))23!

&IGURE 'ROSS &IXED )NVESTMENT AND 4RADE IN 3OUTH !MERICA

!! $ # !" "

3OURCE 7ORLD "ANK $ATABASE

7(!4 )3 ))23!

COMMUNITY AND CIVIL SOCIETY )T INVOLVES SEVERAL LEVELS OF DECISIONMAKING AND TECHNICAL ANALYSIS CONDUCTED BY DIVERSE STAKEHOLDERS RANGING FROM SECTOR EXPERTS TO MINISTERS OF INDIVIDUAL COUNTRIES WITH THE SUPPORT OF MULTILATERAL lNANCING INSTITUTIONS

))23! 4HE #ONSENSUS 2ESPONSE TO A #OMMON #HALLENGE ))23! IS A MULTILATERAL AND MULTISECTORAL CONSENSUS RESPONSE TO THE CHALLENGES OF EFFECTIVE INTEGRATION AND GROWING INFRASTRUCTURE NEEDS 4HE INITIATIVE LAUNCHED BY COUNTRIES IN 3EPTEMBER

INCLUDES ACTIONS AND PLANS TO IMPROVE TRANSPORTATION ENERGY AND TELECOMMUNICATIONS ))23! IS MULTIDISCIPLINARY BECAUSE IT ADDRESSES ECONOMIC SOCIAL LEGAL CULTURAL AND ENVIRONMENTAL DIMENSIONS OF INDIVIDUAL PROJECTS

))23! S !GILE )NSTITUTIONAL 3TRUCTURE ))23! IS MEANT TO BE AGILE RELYING ON THE COORDINATION OF EXISTING INSTITUTIONS 2ATHER THAN CREATING A NEW BUREAUCRACY ))23! WAS BUILT AROUND A CORE GROUP OF DECISIONMAKERS THAT MAKE UP THE %XECUTIVE 3TEERING #OMMITTEE WHICH IN TURN IS ADVISED AND SUPPORTED BY TASK FORCES COMPRISED OF OFlCIALS FROM PARTICIPATING COUNTRIES THE .ATIONAL #OORDINATORS AND THE %XECUTIVE 4ECHNICAL 'ROUPS !DVICE AND EXPERTISE ARE ALSO CONTRIBUTED BY A 4ECHNICAL #OORDINATION #OMMITTEE WHICH INCLUDES STAFF FROM THE )$" THE !NDEAN $EVELOPMENT #ORPORATION #!& AND THE &ONDO &INANCIERO PARA EL $ESARROLLO DE LA #UENCA DEL

))23! HAS BEEN DESIGNED TO ADDRESS THE ASYMMETRIES IN REGIONAL INTEGRATION &ROM THE ONSET THE INITIATIVE WAS DEVISED TO ADDRESS MARKET AND COORDINATION FAILURES AND TO HELP THE PARTICIPATING COUNTRIES OVERCOME OPERATIONAL LEGAL AND INSTITUTIONAL OBSTACLES 4HE INITIATIVE PROVIDES THE TOOLS FOR COORDINATING THE EFFORTS OF PARTICIPATING COUNTRIES AND ACHIEVING THE GOALS SET BY THE REGION S POLITICAL LEADERSHIP BUSINESS

0LATA &/.0,!4! 4HIS SIMPLIlED STRUCTURE FACILITATES CONTINUITY

INCLUSION AND SAVINGS 4HE LOCATION OF ))23! MEETINGS ROTATES FURTHER ENCOURAGING THE GROWTH OF A NETWORK OF REGIONAL OFlCIALS FAMILIAR WITH THE INITIATIVE 4HE PARTICIPATION OF THE PRIVATE SECTOR AND CIVIL SOCIETY IS FOSTERED BY SEMINARS INVITATIONS TO WORK IN TECHNICAL GROUPS THE POSTING OF INFORMATION ON THE ))23! 7EB SITE WWW IIRSA ORG AND INTERNATIONAL PROMOTIONAL EXHIBITS

4HE %XECUTIVE 3TEERING #OMMITTEE COMPOSED OF HIGH LEVEL REPRESENTATIVES FROM THE PARTICIPATING GOVERNMENTS BUILDS AN OVERALL CONSENSUS AND VISION FOR THE INITIATIVE 4HE COMMITTEE TYPICALLY REPRESENTS MINISTRIES INVOLVED IN l NANCING INFRASTRUCTURE AS WELL AS PLANNING AND FOREIGN AFFAIRS )T IS CHAIRED BY A PRESIDENT AND ALTERNATELY TWO VICE PRESIDENTS 4HE LATTER POSTS ARE HELD BY THE PAST PRESIDENT AND THE INCOMING PRESIDENT WHO WILL ASSUME OFl CE BY ROTATION 4HE COMMITTEE ISSUES RECOMMENDATIONS ON THE TECHNICAL WORK DONE BY THE %XECUTIVE 4ECHNICAL 'ROUPS AND 4ECHNICAL #OORDINATION #OMMITTEE ##4

RECOMMENDATIONS ON SPECIl C ISSUES /PERATING LIKE TASK FORCES THEY ARE DISBANDED AFTER THEIR MISSION IS OVER '4%S DEAL WITH ISSUES THAT MAY INCLUDE THE HARMONIZATION AND STANDARDIZATION OF REGULATORY AND LEGAL FRAMEWORKS METHODS TO IDENTIFY AND EVALUATE PROJECTS ENVIRONMENTAL

SOCIAL AND ECONOMIC ANALYSES OF PROJECTS AND HUBS AND INSTITUTIONAL MECHANISMS /NCE '4% MEMBERS REACH AGREEMENT THEIR DECISIONS ARE CARRIED OUT IN EACH COUNTRY BY THE RELEVANT NATIONAL INSTITUTIONS 4HE ##4 PROVIDES MANAGERIAL AND OPERATIONAL SUPPORT FOR ))23!

ACTIVITIES INCLUDING SUPPORT FOR THE '4%S -EMBER INSTITUTIONS ANALYZE THE REQUIREMENTS FOR DEVELOPING SPECIl C PROJECTS AND CONTRACT THE NECESSARY SERVICES UNDER BUDGETARY ALLOWANCES DEl NED BY THE ##4 4HE TECHNICAL REPRESENTATIVES TO THE ##4 FROM THE PARTICIPATING INSTITUTIONS HELP COORDINATE THE OPERATION OF MULTILATERAL AGENCIES BOTH REGIONAL AND NONREGIONAL 4HIS COORDINATION CONTRIBUTES TO ENSURING THAT

%XECUTIVE 4ECHNICAL 'ROUPS '4%S ARE COMPOSED OF OFl CIALS AND EXPERTS REPRESENTING RELEVANT INSTITUTIONS OF THE PARTICIPATING GOVERNMENTS 2EPRESENTATIVES OF THE PRIVATE SECTOR ALSO MAY BE INVITED TO '4% MEETINGS '4%S ARE RESPONSIBLE FOR ANALYZING AND MAKING &IGURE )NSTITUTIONAL 3TRUCTURE OF ))23!

%XECUTIVE 3TEERING #OMMITTEE #$% -INISTERS

%XECUTIVE 4ECHNICAL 'ROUPS '4%S #OUNTRY 2EPRESENTATIVES

.ATIONAL #OORDINATION

4ECHNICAL #OORDINATION #OMMITTEE ##4

)$"

##4 3ECRETARIAT

lNANCING NEEDS ARE IDENTIlED AT AN EARLY STAGE FACILITATING BILATERAL AGREEMENTS BETWEEN ))23! GOVERNMENTS AND THE lNANCIAL INSTITUTIONS

4HE ##4 COORDINATES THE TECHNICAL SUPPORT PROVIDED BY ITS THREE SUPPORTING AGENCIES 4HIS WORK IS FOCUSED ON THE PRIORITY AREAS DElNED

BY THE %XECUTIVE 3TEERING #OMMITTEE #$% AND THE %XECUTIVE 4ECHNICAL 'ROUPS 4HE CONTRIBUTION OF THE THREE MULTILATERAL INSTITUTIONS THAT COMPRISE THE ##4ˆTHE )$" THE #!& AND THE &/.0,!4!ˆINCREASINGLY

))23! S .ATIONAL #OORDINATORS ARE THE BACKBONE OF THE INITIATIVE 4HESE COUNTRY OFlCIALS FOSTER EFFECTIVE IMPLEMENTATION OF PROJECTS BY LINKING TOGETHER A RANGE OF DOMESTIC STAKEHOLDERS CONCERNED WITH INFRASTRUCTURE ISSUESˆSUCH AS GOVERNMENTAL AND REGULATORY AGENCIES )N THIS CAPACITY COORDINATORS CONTRIBUTE TO THE APPLICATION OF ))23! S STANDARDS TO NATIONAL OR SUBNATIONAL PROCEDURES WHILE ACCELERATING PROJECT SELECTION AND IMPLEMENTATION #OORDINATORS FROM DIFFERENT COUNTRIES ALSO FORM A NETWORK THAT HELPS SHARE INFORMATION ABOUT INFRASTRUCTURE AND RELATED MATTERS AMONG COUNTRIES AND DIFFERENT LEVELS OF GOVERNMENT )N ADDITION .ATIONAL #OORDINATORS INTERACT WITH ))23! S 3ECRETARIAT AND INSTITUTIONS THAT COMPRISE THE ##4 AND THEY ARE A CONDUIT TO THE '4%S AND THE %XECUTIVE 3TEERING #OMMITTEE #OORDINATORS CAN SUBMIT PROPOSALS FOR ))23! ACTION BY NATIONAL GOVERNMENTS REGIONAL BODIES AND THE PRIVATE SECTOR &INALLY THEY ARE PRIME INTERLOCUTORS FOR DIALOGUE WITH THE PRIVATE SECTOR

INCLUDES STUDIES AND DEVELOPMENT OF MANAGEMENT TOOLS FOR ENHANCING THE ACTION OF .ATIONAL #OORDINATORS 4HE ##4 S 3ECRETARIAT IS PERMANENTLY BASED IN "UENOS !IRES AT THE )NSTITUTE FOR THE )NTEGRATION OF ,ATIN !MERICA AND THE #ARIBBEAN ).4!, WHICH IS PART OF THE )$" !LL THE DOCUMENTS AND THE RESULTS OF ))23! S MEETINGSˆINCLUDING THOSE BY THE .ATIONAL #OORDINATORS THE '4%S AND THE ANNUAL MEETING OF THE #$%ˆARE POSTED BY ##4 S 3ECRETARIAT ON ))23! S 7EB SITE WWW IIRSA ORG

))23! S .ATIONAL #OORDINATORS ARE THE BACKBONE OF THE INITIATIVE

))23! ). !#4)/.

))23! IS WORKING ALONG THREE MAIN LINES OF ACTION &IRST IT ESTABLISHED A COMPREHENSIVE LIST OF INFRASTRUCTURE PROJECTS THAT WILL SERVE AS A CATALYST FOR REGIONAL INTEGRATION AND GROWTH 3ECOND IT DEVELOPED A FORUM FOR DIALOGUE BETWEEN REGULATORY AND PLANNING AUTHORITIES 4HIRD

IT IS DEVELOPING NEW TOOLS FOR IMPROVING PROJECT IMPLEMENTATION AND FUTURE PROJECT SELECTION 4HESE TOOLS ARE BEING APPLIED EXPERIMENTALLY TO A SELECT GROUP OF PRIORITY PROJECTS ALSO KNOWN AS THE h#ONSENSUS !GENDA v MANY OF WHICH ARE ALREADY IN EXECUTION 4HE FOCUS ON IMPROVING SELECTION AND IMPLEMENTATION HELPS BRIDGE THE GAP THAT OFTEN EXISTS BETWEEN LINE MINISTRIES SUCH AS PUBLIC WORKS AND CENTRAL MINISTRIES SUCH AS lNANCE

BY FACILITATING AN UNDERSTANDING OF THE COSTS AND BENElTS OF PROJECTS AND THEIR EVALUATION WITHIN THE GENERAL lNANCIAL OBJECTIVES AND CONSTRAINTS OF THE GOVERNMENT

ENERGY AND COMMUNICATIONS AND WILL HELP GOVERNMENTS SET PRIORITIES FOR INTEGRATION AND TRADE FOR YEARS TO COME AND ALSO BUTTRESS THE REGIONAL DIALOGUE 4HE PORTFOLIO IS FURTHER CONSOLIDATED AROUND EIGHT ORIGINAL )NTEGRATION AND $EVELOPMENT (UBS THE (UBS 4HE CONCEPT OF THE (UB IS NOVEL IN THAT IT ATTEMPTS TO FULLY ADDRESS THE ECONOMIC

SOCIAL AND ENVIRONMENTAL DIMENSIONS OF PHYSICAL INTEGRATION AND THEIR INTERPLAY IN THE PROJECT DEVELOPMENT PROCESS 0ROJECT SELECTION WAS ORGANIZED AROUND TWO PRINCIPLES /NE WAS THE ANTICIPATED IMPACT BY THE PROJECT ON EFFECTIVE SUSTAINABLE DEVELOPMENT AND THE OTHER WAS FEASIBILITY 0ROJECTS WERE ASSESSED NOT IN ISOLATION BUT AS PART OF A PORTFOLIO ASSOCIATED WITH A HUB 4HE PROJECTS CHOSEN AND EVALUATED REmECTED A CONSENSUS BY THE %XECUTIVE 4ECHNICAL 'ROUP RESPONSIBLE FOR EACH HUB 4HE ESTIMATED PUBLIC AND PRIVATE INVESTMENT OF 53 BILLION FOR THE PROJECTS IS RELATIVELY MODEST COMPARED WITH THEIR ANTICIPATED IMPACT REmECTING THE RESTRAINT IMPOSED BY THE HIGH STANDARDS OF FEASIBILITY AND AFFORDABILITY ADOPTED BY THE TECHNICAL GROUPS

))23! IDENTIlED A PORTFOLIO OF INFRASTRUCTURE PROJECTS THAT REmECT A COMMON REGIONWIDE VISION OF OPPORTUNITIES FOR INTEGRATION AND DEVELOPMENT 4HIS PORTFOLIO CONSISTS OF PROJECTS IN TRANSPORTATION

4HE ))23! (UBS 4EN HUBS HELP MAP OPPORTUNITIES AND INFRASTRUCTURE DEMAND IN 3OUTH !MERICA (UBS REmECT THE ECONOMIC DEMOGRAPHIC AND PHYSICAL AFlNITIES OF LARGE SECTIONS OF 3OUTH !MERICA -OST HUBS OVERLAP WITH AT LEAST ONE OTHER HUB 3EVERAL HUBS COVER TERRITORY COAST TO COAST WHILE THE ENVISAGED IMPACT OF OTHERS IS IN THE INTERIOR SUCH AS THE HUB BUILT AROUND !RGENTINA S NORTHERN PROVINCES A LARGE AND RESOURCE RICH REGION STILL LARGELY UNDEVELOPED THAT IS THE FOCUS OF SPECIAL ATTENTION BY THE NATIONAL GOVERNMENT 4HE BLOSSOMING OF THIS REGION COULD BRING IMPORTANT BENElTS TO "OLIVIA AND 0ARAGUAY CREATING A WHOLE NEW POLE OF DEVELOPMENT FOR THE CONTINENT ! LIST OF PROJECTS HAS BEEN IDENTIlED FOR THE EIGHT ORIGINAL HUBS

AND WORK IS UNDERWAY TO SELECT SPECIlC PROJECTS FOR THE OTHER TWO HUBS WHICH ARE MORE RECENT

&IGURE ))23! )NTEGRATION AND $EVELOPMENT (UBS )$(

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4HE !NDEAN (UB COMPRISES CONNECTIONS TRUNK ROAD NETWORKS

PORTS AIRPORTS AND BORDER CROSSINGS IN "OLIVIA #OLOMBIA

%CUADOR 0ERU AND 6ENEZUELA )T INCLUDES GROUPS OF PROJECTS

MANY AROUND THE 0AN !MERICAN (IGHWAY AND THE -ARGINAL *UNGLE (IGHWAY WHICH CONNECTS THE !NDES IN 6ENEZUELA AND THE !MAZON BASIN IN #OLOMBIA %CUADOR AND 0ERU

4HE 'UIANESE 3HIELD (UB COMPRISES FOUR PROJECT GROUPS FOCUSING MAINLY ON ROADS 4HEY WILL STRENGTHEN THE #ARIBBEAN COASTAL LINKS AMONG 6ENEZUELA 'UYANA AND 3URINAME AND THE COAST AND THE !MAZON BASIN 6ENEZUELA -ANAUS AND 'EORGETOWN "ELA 6ISTA

4HE !MAZON (UB INCLUDES REGIONS IN #OLOMBIA %CUADOR

0ERU AND "RAZIL )TS SEVEN GROUPS OF PROJECTS AIM PRIMARILY AT IMPROVING ROADS AND WATERWAYS IN THE AREA TO HELP ESTABLISH A lRM CONNECTION BETWEEN THE 0ACIlC AND !TLANTIC COASTS )T ALSO FOCUSES ON IMPROVING THE AVAILABILITY OF ELECTRICITY THAT COULD MARKEDLY IMPROVE THE WELFARE OF THE MILLION PEOPLE WHO LIVE IN THE AREA

4HE 0ERU "RAZIL "OLIVIA (UB COMPRISES THREE GROUPS OF PROJECTS /NE OF THEM IS AIMED AT LINKING THE NORTHWESTERN "RAZILIAN STATE OF !CRE WITH THE EASTERN SIDE OF THE !NDES AND THE 0ERUVIAN COAST BY ROAD 4HE OTHERS WILL LINK ,A 0AZ THE "OLIVIAN LOWLANDS AND THE !MAZON BASIN

4HE #ENTRAL )NTEROCEANIC (UB INVOLVES lVE GROUPS OF PROJECTS

INCLUDING THE MODERNIZATION OF TWO TRANSPORTATION NETWORKS OUT OF "OLIVIA AND THE STRENGTHENING OF THE RAIL SYSTEM OF 3ÎO 0AULO

"RAZIL 4HE WESTWARD PROJECTS INCLUDING SEVERAL ON THE "OLIVIAN BORDER WILL STRENGTHEN THE LINKS TO 0ERUVIAN AND #HILEAN PORTS 4HE EASTWARD PROJECTS INVOLVE MAINLY THOSE IN "RAZIL AND

TOGETHER WITH THE ENHANCEMENT OF BORDER INFRASTRUCTURE MAY HAVE A SIGNIlCANT IMPACT ON THE 3ANTA #RUZ AREA IN "OLIVIA 4HE HUB ALSO INCLUDES THE NORTHERN PART OF A RAILROAD BELTWAY THAT WILL BE BUILT AROUND THE CITY OF 3ÎO 0AULO 4HE ENHANCED RAIL SYSTEM WILL DRAMATICALLY REDUCE TRANSPORTATION COSTS TO THE "RAZILIAN PORTS OF 3ANTOS AND 3EPETIBA AS WELL AS CONGESTION IN THE CITY OF 3ÎO 0AULO

4HE #APRICORN (UB FEATURES SEVERAL SMALL AND MEDIUM SIZED PROJECTS DESIGNED TO REVITALIZE THE INTERIOR OF NORTHERN !RGENTINA AND SOUTHERN 0ARAGUAY 4HIS REGION IS LIKELY TO BENElT FROM NEW DEVELOPMENTS IN AGRICULTURE AND GIVEN ITS RELATIVELY LOW POPULATION DENSITY MAY HAVE POTENTIAL FOR VERY RAPID GROWTH AS A RESULT OF BETTER DOMESTIC AND CROSS BORDER COMMUNICATIONS 4HE HUB ALSO INCLUDES PROJECTS TO ENHANCE ACCESS BY 0ARAGUAY TO THE !TLANTIC THROUGH "RAZILIAN PORTS ESPECIALLY IMPROVEMENTS IN BORDER INFRASTRUCTURE

4HE -%2#/352 #HILE (UB INCLUDES lVE GROUPS OF PROJECTS

THREE OF WHICH WILL ULTIMATELY CREATE A TRANSPORTATION SYSTEM THROUGH 5RUGUAY AND !RGENTINA THAT WILL LINK #HILE TO THE STATE OF -INAS 'ERAIS IN CENTRAL "RAZIL !NOTHER GROUP OF PROJECTS WILL REVITALIZE ROAD CONNECTIONS IN THE PROVINCE OF 3ANTA &E

!RGENTINA INCLUDING AN UNDERWATER TUNNEL LINKING IT TO THE PROVINCE OF 0ARANÉ 4HE -%2#/352 #HILE (UB ALSO INCLUDES A STRONG GROUP OF PROJECTS IN THE ENERGY SECTOR LINKED TO THE COMPLETION OF MAJOR HYDROPOWER PROJECTS IN !RGENTINA AS WELL AS FURTHER INTEGRATION OF THE "RAZILIAN !RGENTINE AND 5RUGUAYAN NATURAL GAS PIPELINE NETWORK

4HE 3OUTHERN (UB COMPRISES TWO GROUPS OF PROJECTS GEARED TOWARD IMPROVING CROSS BORDER CONDITIONS IN THE SOUTHERN !NDES AND THE MAINTENANCE OF ROAD INFRASTRUCTURE IN THE LAKE REGION AN IMPORTANT TOURIST DESTINATION

4HE 0ARAGUAY 0ARANÉ 7ATERWAY (UB IS ONE OF THE NEWEST

ESTABLISHED IN !LTHOUGH A lNAL LIST OF PROJECTS HAS YET TO BE COMPLETED THE HUB MAY BECOME THE MAIN INLAND WATERWAY SYSTEM LINKING THE 4IETÏ 0ARANÉ 0ARAGUAY 0ARANÉ 5RUGUAY AND ,A 0LATA RIVER NETWORKS

4HE 3OUTHERN !NDEAN (UB IS A RECENT ENDEAVOR THAT IS AWAITING PROJECT SELECTION 4HE CLEAR COMMITMENT OF #HILE TO FURTHER DEVELOPMENT OF ))23! SHOULD SOON BE REmECTED IN THE COMPLETION OF THE PROJECT LIST

)MPLEMENTATION !GENDA BASED ON #ONSENSUS 5SING NEW MANAGEMENT TOOLS 4HE )NFORMATION 3YSTEM FOR 3TRATEGIC 0ROJECT -ANAGEMENTˆ)330- 3)'% IN 3PANISH

4HE )NFORMATION 3YSTEM FOR 3TRATEGIC 0ROJECT -ANAGEMENTˆ)330- 3)'% IN 3PANISH ˆWAS DEVELOPED TO MANAGE ))23! PROJECTS

PROVIDING A TOOL TO HELP PREDICT THE m OW OF REQUIRED RESOURCES AND ANTICIPATE ANY SLIPPAGE OR BOTTLENECK IN IMPLEMENTATION )330- WILL CONTRIBUTE TO REDUCING THE OVERALL COST OF PROJECTS BY CUTTING DEAD TIME AND HELPING TO COORDINATE THE WORK OF DIFFERENT GOVERNMENT AGENCIES SUPPLIERS AND CONTRACTORS )T WILL THEREBY HELP INCREASE THE RATE OF RETURN OF PUBLIC AND PRIVATE INVESTMENT IN INFRASTRUCTURE IN 3OUTH !MERICA 4HE TOOL ALREADY HELPS PUBLIC OFl CIALS AND TECHNICAL SPECIALISTS SHARE INFORMATION ALLOWING GOVERNMENT TO KNOW TO BETTER CONTROL AND TO INFORM STAKEHOLDERS ABOUT THE STATUS AND PROGRESS OF INDIVIDUAL PROJECTS ENSURING A HIGHER LEVEL OF TRANSPARENCY FOR ))23! ACTIVITIES )N SHORT )330- ALREADY IS DEMONSTRATING THE ADVANTAGES OF MOVING AWAY FROM CUMBERSOME AND EXCESSIVELY BUREAUCRATIC PROJECT OVERSIGHT TO A REAL TIME OBJECTIVE SYSTEM OF PROJECT MANAGEMENT THAT IS NEEDED TO MAKE BETTER USE OF PUBLIC FUNDS

))23! AS 0ROMOTER OF THE h3OFTWAREv FOR )NTEGRATION ))23! HAS PROVIDED A FORUM FOR THE DIALOGUE AMONG THE COUNTRIES

,OOKING FORWARD ))23! IS ALSO DEVELOPING TOOLS TO HELP BETTER

REGULATORY AND PLANNING AUTHORITIES 4HE INITIATIVE HAS DEVELOPED A

IDENTIFY THE INDIRECT ECONOMIC EFFECTS OF KEY PROJECTS 4HIS

MECHANISM THE 3ECTORAL )NTEGRATION 0ROCESSES 3)0S TO HELP IDENTIFY

SYSTEMATIC APPROACH WILL BE INSTRUMENTAL IN THE CONTINUOUS DElNITION

REGULATORY OPERATIONAL AND INSTITUTIONAL OBSTACLES TO THE EFlCIENT USE OF

OF PRIORITIES IN THE PROJECT PIPELINE )T IS AIMED AT HELPING MAKE THIS

THE REGION S BASIC INFRASTRUCTURE 4HROUGH THE 3)0S REGIONAL WORKING

CHOICE AS TRANSPARENT AND COMPREHENSIVE AS POSSIBLE CONSIDERING THE

GROUPS HAVE BEEN ORGANIZED TO PROMOTE HARMONIZATION OF THE POLICIES

ECONOMIC SOCIAL AND ENVIRONMENTAL IMPLICATIONS OF EACH PROJECT )N A

PLANS AND LEGAL AND INSTITUTIONAL FRAMEWORKS GOVERNING THE USE OF

MULTILATERAL SETTING THIS APPROACH CAN HELP FORGE CONSENSUS AROUND A

INFRASTRUCTURE

SET OF PROJECTS AND BUILD OUTSIDE SUPPORT FROM CIVIL SOCIETY THE PRIVATE SECTOR AND THE INTERNATIONAL lNANCIAL COMMUNITY

3TUDIES UNDER THE AUSPICES OF THE 3)0S HAVE COVERED SEVEN SECTORS 4HESE STUDIES CAN BE FOUND ON THE ))23! 7EB SITE WWW IIRSA

))23! HAS ALSO BEEN A LABORATORY FOR INNOVATIVE PUBLIC INVESTMENT

ORG AND PROVIDE A DIAGNOSIS OF THE SECTORS AS WELL AS INDICATIONS ON

MANAGEMENT PRACTICES 4O ENSURE QUICK HIGH QUALITY IMPLEMENTATION

HOW TO ADDRESS SOME OF THE ISSUES IDENTIlED IN THE PROCESS

OF COMPLEX PROJECTS ))23! IS BETTING HEAVILY ON THE DEVELOPMENT AND DISSEMINATION OF MODERN TRANSPARENT PUBLIC MANAGEMENT TOOLS IN

s !IR TRANSPORTATION HTTP WWW IIRSA ORG SEC4AEREO?%.'

PARTICULAR THE CONCEPT OF INTENSIVE PROJECT MANAGEMENT !MONG THESE

ASP #OD)DIOMA %.'

TOOLS IS THE )NFORMATION 3YSTEM FOR 3TRATEGIC 0ROJECT -ANAGEMENT

s -ARITIME TRANSPORTATION HTTP WWW IIRSA ORG 3EC4-ARITIMO?%.'

DEVELOPED WITH THE HELP OF THE )$" AND &/.0,!4! AND KNOWN IN

ASP #OD)DIOMA %.'

3PANISH AS 3)'% !PPLYING THESE TOOLS TO SPECIlC ))23! PROJECTS

s -ULTIMODAL TRANSPORTATION HTTP WWW IIRSA ORG 3EC4-ULTIMODAL

REQUIRES COOPERATION BETWEEN THE PROJECT MANAGER AND THE .ATIONAL

ASP #OD)DIOMA %30

#OORDINATORS 3PECIlC TOOLS ARE BEING TESTED IN THE IMPLEMENTATION

s "ORDER CROSSING FACILITATION HTTP WWW IIRSA ORG 3EC0&RONTERA?

OF THE PRIORITY PROJECTS !N EVENTUAL GOAL IS TO MAKE THESE TOOLS

%.' ASP #OD)DIOMA %.'

STANDARD FEATURES IN THE MANAGEMENT STRUCTURE OF MOST 3OUTH !MERICAN

s %NERGY INTEGRATION HTTP WWW IIRSA ORG SEC%NERGIA?%.'

PLANNING AND PUBLIC WORKS MINISTRIES 4RANSPARENCY IS PARTICULARLY

ASP #OD)DIOMA %.'

IMPORTANT TO ))23! PROJECTS WHICH OFTEN COMPETE FOR lNANCING WITH

s )NFORMATION AND COMMUNICATIONS TECHNOLOGY HTTP WWW IIRSA

NATIONAL PROJECTS 2EINFORCING THE ABILITY OF LOCAL AGENCIES TO SELECT

ORG 3EC4ELECOM?%.' ASP #OD)DIOMA %.'

DEVELOP IMPLEMENT MONITOR AND EVALUATE PROJECTS IS A MAJOR PRIORITY

s &INANCING MECHANISMS HTTP WWW IIRSA ORG SEC)lNANCIA?%.'

OF ))23! AND ONE OF THE MAJOR NEEDS OF THE REGION

ASP #OD)DIOMA %.'

"OX ))23! S %NVIRONMENTAL !PPROACH

))23! S COMPREHENSIVE APPROACH TO PROJECTS PLACES A PRIORITY ON ENVIRONMENTAL PROTECTION AND IS RESPONSIVE TO A GROWING AWARENESS OF ITS IMPORTANCE BY THE PEOPLE OF THE REGION /RGANIZED SOCIETY AND ELECTED GOVERNMENTS ARE INCREASINGLY ATTUNED TO THIS REALITY 4HE ))23! APPROACH OF APPLYING THE CONCEPT OF HUBS HELPS ADDRESS ENVIRONMENTAL ISSUES IN A STRUCTURED WAY AND OFFERS PLANNERS AND OTHER STAKEHOLDERS A VISION OF DEVELOPMENT OPPORTUNITIES ALTERNATIVES AND NEEDS TO ENSURE EFFECTIVE AND BALANCED REGIONAL INTEGRATION 4HIS EFFORT HAS BEEN REINFORCED BY PROMOTIONAL ACTIVITIES SUCH AS SEMINARS AND THE DEVELOPMENT OF PLANNING TOOLS AND OTHER MECHANISMS ))23! TRANSPORTATION PROJECTS THAT INTEGRATE RIVERS AND OTHER WATERWAYS WITH ROADSˆFOR INSTANCE BY IMPROVEMENTS IN PORTS AND STORAGE STRUCTURESˆARE EXAMPLES PUTTING A PRIORITY ON PROTECTING THE ENVIRONMENT 4HIS KIND OF MULTIMODAL TRANSPORTATION REDUCES THE LENGTH OF ROADS NEEDED TO EFFECTIVELY LINK CITIES IN THE REGION THEREFORE REDUCING THE ENVIRONMENTAL IMPACT OF HIGHWAYS AND TRAFlC ON LAND CONNECTIONS 4HE )$" AND OTHER lNANCIAL INSTITUTIONS SUPPORT THE ))23! COMMITMENT TO PROTECT THE ENVIRONMENT AND TAKE A PROACTIVE APPROACH WHEN ANALYZING THE ENVIRONMENTAL AND SOCIAL DIMENSIONS OF POTENTIAL INFRASTRUCTURE PROJECTS 7HEN AN ))23! INFRASTRUCTURE PROJECT OR ANOTHER PROPOSAL IS SUBMITTED TO THE )$" FOR POSSIBLE lNANCING THE ENVIRONMENTAL AND SOCIAL IMPACTS ARE TAKEN INTO ACCOUNT AT THE ONSET OF THE "ANK S PARTICIPATION 4HE )$" PREPARES GUIDELINES AND REVIEWS PROJECTS TO HELP BORROWERS CARRY OUT VARIOUS ANALYSES STUDIES AND ACTION PLANS TO ENSURE THAT THE BEST PRACTICES ARE APPLIED FOR RESOURCE USE THAT ARE SUSTAINABLE AND SOCIALLY RESPONSIBLE 4HE GOAL IS NOT ONLY TO MEET THE STANDARDS OF NATIONAL LEGISLATION INTERNATIONAL RULES AND )$" POLICIES BUT ALSO TO ENRICH THE PROJECT AND STRENGTHEN NATIONAL AND REGIONAL ENVIRONMENTAL AND SOCIAL STANDARDS APPLYING THE EXPERIENCES AND EXPERTISE OF THE COUNTRIES AND OTHER STAKEHOLDERS IN TECHNICAL SOCIAL AND ENVIRONMENTAL DESIGN AND PROTECTION MECHANISMS 3PECIAL FUNDS INCLUDING GRANTS ARE AVAILABLE TO lNANCE PRELIMINARY STUDIES ON HOW ))23! OR OTHER INFRASTRUCTURE PROJECTS CAN BE STRUCTURED TO ENHANCE THE CAPABILITY OF COUNTRIES AND lNANCIAL INSTITUTIONS TO MINIMIZE THE ENVIRONMENTAL IMPACT

4(% ))23! h#/.3%.353 !'%.$!v /& 02)/2)49 02/*%#43

4HE h#ONSENSUS !GENDAv PROVIDES FOCUS FOR THE CURRENT PHASE OF ))23! 4HIS CONSENSUS AGENDA APPROVED IN .OVEMBER INCLUDES HIGH IMPACT PROJECTS TO BE CARRIED OUT DURING 4HE PORTFOLIO IS NOT STATIC 7HILE THE FOCUS IT PROVIDES HELPS GOVERNMENTS ASSIGN PRIORITY TO PROJECTS WITHIN A FRAMEWORK OF lSCAL DISCIPLINE OTHER PROJECTS MAY BE INCLUDED IN THE PORTFOLIO OVER TIME AS THE ORIGINAL PROJECTS ARE IMPLEMENTED SEE &IGURE

4HE PRIORITY PORTFOLIO COMPRISES INVESTMENTS TOTALING 53 BILLION -OST OF THE INVESTMENTS FOR A TOTAL OF 53 BILLION CORRESPOND TO ROAD PROJECTS &IFTEEN OF THE PRIORITY PROJECTS JUST UNDER HALF THE TOTAL REQUIRE INVESTMENTS FROM MORE THAN ONE COUNTRY 4HE OTHER ARE NATIONAL PROJECTS WITH A STRONG hBRIDGING EFFECTv ACROSS NATIONAL BORDERS TYPICALLY RAISING THE RETURN ON PREVIOUS INVESTMENTS IN THE SAME COUNTRY OR IN A NEIGHBORING COUNTRY SEE &IGURE

&IGURE 4HE #ONSENSUS !GENDA 0ROJECTS BY 3ECTOR

&IGURE 0RIORITY !GENDA 4RANSPORTATION 0ROJECTS BY 4YPE

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4HE ))23! PRIORITY PORTFOLIO IS ALREADY IN THE IMPLEMENTATION PHASE !MONG THESE PROJECTS HAVE SECURED lNANCIAL COMMITMENTS FROM INSTITUTIONS THAT COMPRISE ))23! S 4ECHNICAL #OORDINATION #OMMITTEE )$" #!& AND &/.0,!4! 4HE EXTERNAL lNANCING FROM THESE SOURCES

TOTALS ABOUT 53 BILLION LEAVING 53 BILLION TO BE lNANCED BY GOVERNMENTS OR OTHER INSTITUTIONS !LSO NINE PROJECTS ARE ALREADY IN EXECUTION WHILE FOUR ARE AT THE BIDDING STAGE ARE IN PREPARATION AND ONE THE BRIDGE OVER THE !CRE 2IVER HAS BEEN COMPLETED 4ABLE

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2EHABILITATION AND #ONSTRUCTION OF 0ASTO -OCOA 2OAD

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-AP !NDEAN $EVELOPMENT #ORPORATION

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WILL RESTORE AND ADAPT THE EXISTING RAILWAY CONNECTION 4HE TWO CITIES ARE IMPORTANT NODES IN THE BASIC RAILWAY NETWORK OF THE RESPECTIVE COUNTRIES !S SUCH THE SERVICE IS EXPECTED TO MOVE TONS OF FREIGHT IN THE lRST YEAR OF OPERATION AND UP TO MILLION TONS IN THE lFTH "Y THE TENTH YEAR TRAFlC SHOULD RISE TO MILLION TONS ABSORBING PERCENT OF THE CARGO TRAFlC NOW TRUCKED BY HIGHWAY THROUGH THE #RISTO 2EDENTOR 0ASS 3TUDIES SHOW THAT THE PROJECT CAN ACHIEVE AN INTERNAL ECONOMIC RETURN RATE OF PERCENT FOR THE #HILEAN SECTION AND PERCENT FOR THE !RGENTINE SIDE 4HE ANTICIPATED INVESTMENT IS ESTIMATED AT 53 MILLION WITH PARTICIPATION OF THE PRIVATE SECTOR #ONCESSION TEAMS FROM BOTH COUNTRIES ARE COORDINATING THE TERMS OF THE TENDER DOCUMENTS WITH A VIEW TO CALL BIDS SOON

#ONSTRUCTION OF THE *AGUARÎO 2IO "RANCO "RIDGE IS A BINATIONAL PROJECT AT THE BORDER OF "RAZIL AND 5RUGUAY ! MODEST INVESTMENT OF 53 MILLION WILL LEVERAGE A MAJOR OVERHAUL OF ONE OF THE MAIN ROADS CROSSING 5RUGUAY #URRENTLY THE BORDER CROSSING BETWEEN 5RUGUAY AND "RAZIL IS PRECARIOUS RELYING ON A ONE LANE DECADES OLD BRIDGE THAT WILL BE A BOTTLENECK AFTER THE CONCLUSION OF THE ))23! PROJECT FOR h5PGRADING THE 2IO "RANCO -ONTEVIDEO #OLONIA .UEVA 0ALMIRA 2OAD #ORRIDOR v 4HE NEW BRIDGE WILL BE AN IMPORTANT LINK IN THE -%2#/352 #HILE (UB &EASIBILITY STUDIES SCHEDULED TO BE lNISHED BY .OVEMBER ALREADY SUGGEST AN ESTIMATED RATE OF RETURN OF PERCENT FOR THE PROJECT THAT MAY OR MAY NOT BE CAPTURED BY TOLLS

$UPLICATION OF 2OUTE BETWEEN 0ASOS DE LOS ,IBRES AND 'UALEGUAYCHÞ IS A PROJECT TO BE CARRIED OUT BY !RGENTINA !LTHOUGH IMPLEMENTED AT THE NATIONAL LEVEL THE PROJECT IS EXPECTED TO HAVE POSITIVE EXTERNALITIES BEYOND NATIONAL BORDERS 4HE ROAD FORMS A 3OUTH .ORTH CORRIDOR THAT CROSSES THE THREE PROVINCES OF A REGION IN !RGENTINA KNOWN AS -ESOPOTAMIA !VERAGE DAILY TRAFlC NOW EXCEEDS

VEHICLES AND THE DUPLICATION OF THE ROAD WIDENING IT FROM ONE LANE IN EITHER DIRECTION TO TWO LANES IN EITHER DIRECTION WILL FACILITATE INTERNATIONAL TRAFlC BETWEEN #HILE AND "RAZIL AS WELL AS THE LAND CONNECTION WITH 0ARAGUAY 3TUDIES INDICATE AN ECONOMIC RATE OF RETURN OF PERCENT BASED ON AN ANNUAL INCREASE OF OVERALL TRAFlC OF PERCENT A YEAR IN ADDITION TO A PERCENT INCREASE IN LIGHT VEHICLE TRAFlC AND AN PERCENT INCREASE IN BUS TRAFlC 4HE TOTAL ESTIMATED INVESTMENT IS

4HE ,OS !NDES -ENDOZA RAILWAY LINKING #HILE AND !RGENTINA IS ANOTHER HIGH IMPACT PROJECT IN THE -%2#/352 #HILE (UB 4HE PROJECT CONSISTS OF THE REACTIVATION OPERATION AND MAINTENANCE OF RAILWAY FREIGHT TRANSPORTATION SERVICE THAT LINKS -ENDOZA !RGENTINA WITH THE #HILEAN CITY OF ,OS !NDES KILOMETERS FROM 3ANTIAGO 4HE PROJECT -APS !NDEAN $EVELOPMENT #ORPORATION

)N SUPPORTING THIS PROJECT THE )$" APPROVED ITS lRST GUARANTEE FOR A PUBLIC SECTOR lNANCING PROGRAMˆAN INNOVATIVE OPERATION DESIGNED TO ATTRACT GREATER PRIVATE INVESTMENT IN THE FRAMEWORK OF A PUBLIC PRIVATE PARTNERSHIP AND TO REDUCE COSTS FOR A STRATEGIC ))23! ROAD IN NORTHERN 0ERU 4HE 53 MILLION GUARANTEE SERVES AS A CREDIT ENHANCEMENT TO THE EXPECTED 53 MILLION INVESTMENT FOR THE IMPROVEMENT AND REHABILITATION OF A KILOMETER ROAD SYSTEM SEE "OX IN SECTION ON h))23! AND THE 0RIVATE 3ECTORv 4HE -ODERNIZATION OF THE #ALLAO 0ORT INVOLVES THE CONSTRUCTION OF A NEW CONTAINER TERMINAL IN 0ERU THAT WILL RAISE THE PRODUCTIVITY OF A 53 MILLION 4HE )$" IS CONTRIBUTING WITH A 53 MILLION LOAN TO THE GOVERNMENT OF !RGENTINA 4HE 0ROVINCE OF #ORRIENTES HAS ALREADY CARRIED OUT ENVIRONMENTAL HEARINGS AND THE DETAILED DESIGN IS BEING DEVELOPED AND WILL BE PRESENTED SOON

NUMBER OF INVESTMENTS PROGRAMMED FOR THE AREA )T IS ESTIMATED THAT THE PROJECT WILL ENABLE THE TRANSIT OF CONTAINERS TO RISE FROM

FOOT EQUIVALENT UNITS 4%5 MOVED IN TO

4%5 IN AND MILLION IN

4RANSPORTATION INVESTMENTS IN ))23! ALSO INCLUDE MULTIMODAL PROJECTS 4HE 0AITA 4ARAPOTO 9URIMAGUAS 2OADS 0ORTS AND ,OGISTICAL #ENTERS INITIATIVE ENTAILS INVESTMENT IN RIVER AND MARITIME PORTS ROADS AND LOGISTICAL CENTERS 4HIS GROUP OF PROJECTS STRENGTHENS LOGISTICAL CHAINS IN THE AREA AND LOWERS THE COSTS OF VEHICLE TRAFlC ! GOAL IS TO lNANCE THESE PROJECTS THROUGH PUBLIC PRIVATE PARTNERSHIPS )T IS ESTIMATED THAT THE PROJECT WILL LEAD TO A REDUCTION IN VEHICLE OPERATING COSTS BY MORE THAN 53 MILLION IN THE NEXT TWO DECADES 4HE PROJECT IS ONE OF THE MAIN MULTIMODAL PROJECTS INCLUDED IN THE #ONSENSUS !GENDA 4HIS TYPE OF INVESTMENT HAS A MINOR ENVIRONMENTAL IMPACT BECAUSE IT BENElTS FROM THE SYNERGIES AMONG THE DIFFERENT MEANS OF TRANSPORTATION AND MINIMIZES ROAD WORKS 0ROMOTING INTERNATIONAL TRADE IT WILL ADVANCE THE CONSOLIDATION OF THE COAST MOUNTAIN JUNGLE INTEGRATION CORRIDOR OF THE NORTHERN REGION OF 0ERU THAT WILL BE LINKED TO ITS REGIONAL PARTNER THE "RAZILIAN STATE OF !MAZONIA

4HE CONSTRUCTION AND IMPLEMENTATION OF THE $ESAGUADERO "ORDER #ENTER BETWEEN "OLIVIA AND 0ERU IS A PRIME EXAMPLE OF A CROSS BORDER PROJECT SPONSORED BY ))23! 4HE OBJECTIVE OF THIS PROJECT IS TO INSTALL AN INTEGRATED BINATIONAL CONTROL CENTER AT $ESAGUADERO A BORDER CROSSING THAT ACCOUNTS FOR PERCENT OF THE TRAFlC BETWEEN THE TWO COUNTRIES 4HIS NEW CENTER WILL FACILITATE THE CIRCULATION OF PASSENGERS GOODS AND

4HIS TYPE OF INVESTMENT ALSO AVOIDS THE hTURNPIKE EFFECT v AS IT CONSTITUTES A COMMERCIAL AND SERVICE PLATFORM THAT REINFORCES THE EXISTING LOGISTIC CHAINS IN THE AREAS OF INmUENCE OF THE PROJECT ALLOWING THE SUSTAINABLE DEVELOPMENT OF THE BENElCIARY POPULATIONS WHICH HAVE TRADITIONALLY BEEN ISOLATED NATIONALLY AS WELL AS REGIONALLY

VEHICLES THROUGH THE ROUTE STIMULATING TRADE mOW AND FOSTERING REGIONAL ECONOMIC RELATIONS IN THE !NDEAN REGIONS OF 0ERU AND "OLIVIA AS WELL AS THE NORTHWESTERN REGION OF !RGENTINA 4HE COORDINATION FEATURES OF ))23! PROVED RELEVANT TO PROMOTE A PROJECT EXPECTED TO SUBSTANTIALLY REDUCE TRANSPORTATION TIME AT THE BORDER

&EASIBILITY STUDIES FOR THE 0AITA 4ARAPOTO 2OAD WHICH IS THE MAIN ROADWORK OF THE INVESTMENT GROUP INDICATE AN ECONOMIC RETURN RATE OF PERCENT 4HE BUILDING OF THIS ROAD WILL HAVE A POWERFUL IMPACT ON THE REDUCTION OF VEHICLE OPERATION COSTS 4HE TOTAL ESTIMATED INVESTMENT IN THIS CLUSTER IS 53 MILLION

4HIS PROJECT WILL REDUCE WAITING TIMES FOR TRAFlC INTO BOTH COUNTRIES FROM ABOUT THREE HOURS TO ABOUT MINUTES 4HE $ESAGUADERO "ORDER #ENTER WAS ALSO SELECTED AS ONE OF THE lVE ))23! PILOT PROJECTS FOR THE MODERNIZATION OF )NTERNATIONAL #USTOMS 4RAFlC "EST PRACTICES IN

4HE IMPLEMENTATION OF ROAMING AGREEMENTS IN 3OUTH !MERICA AND POSTAL EXPORTING FOR SMALL AND MEDIUM ENTERPRISE PROJECTS ARE EXAMPLES OF THE OPPORTUNITIES THAT CAN RESULT FROM BETTER HARMONIZATION OF REGULATIONS AND PROCEDURES 4HE ROAMING PROJECT IS NOW BEING PREPARED FOR A PILOT PHASE IN 0ERU AND "RAZIL #ELLULAR TELEPHONY IN 3OUTH !MERICA HAS A PENETRATION RATE OF PERCENTˆA RATE THAT IS GROWING BY PERCENT A YEAR #ONSIDERING THAT THIS RATE IS POTENTIALLY EVEN GREATER FOR THE TARGETED POPULATION GROUP BECAUSE OF ITS RELATIVE REGIONAL MOBILITY AND BECAUSE OF THE RELATIONSHIP BETWEEN AVERAGE INCOME AND PENETRATION RATE THE IMPLEMENTATION OF A 3OUTH !MERICAN REGIONAL ROAMING SERVICE WOULD OFFER A UNIQUE PLATFORM ON WHICH NEW BUSINESS OPPORTUNITIES COULD BE CREATED BOTH IN VOICE AND DATA TRAFlC !T THE SAME TIME PUBLIC ENTITIES WOULD BE ABLE TO OBTAIN HIGHER INCOMES THROUGH BOTH PHONE CALLS AND TAXES ON THE ECONOMIC ACTIVITIES INDUCED BY THE NEW SERVICES !DDITIONALLY THE IMPLEMENTATION OF THE NEW ' TELEPHONE SERVICES TO BE DEPLOYED IN THE MEDIUM TERM

WILL ALLOW THE SPREADING OF MORE mEXIBLE BROADBAND )NTERNET SERVICES

THESE PROJECTS WILL BE EXTENDED TO OTHER COUNTRIES IN THE REGION /N THE 0ERUVIAN SIDE THE PROJECT IS IN ITS lNAL STAGES OF PREPARATION PRIOR TO EXPECTED )$" lNANCING &EASIBILITY STUDIES INDICATE AN ECONOMIC RETURN RATE FOR "OLIVIA AND 0ERU OF PERCENT AND PERCENT WITH DISCOUNT RATES OF PERCENT AND PERCENT RESPECTIVELY 4HESE DATA REmECT THE HIGH SOCIOECONOMIC IMPACT OF THE PROJECT ESPECIALLY REGARDING NATIONAL POLICIES AND STRATEGIES TO PROMOTE INTERNATIONAL TRADE 4HE ))23! PORTFOLIO INCLUDES 53 BILLION IN INVESTMENTS IN ENERGY INTERCONNECTIONS AND 53 BILLION IN PROJECTS FOR ENERGY PRODUCTION 3OUTH !MERICA HAS AN ABUNDANT SUPPLY OF OIL GAS COAL AND HYDROELECTRIC POTENTIAL OFFERING VERY SIGNIlCANT OPPORTUNITIES FOR THE DEVELOPMENT OF NEW PROJECTS IN THIS lELD 4HE

.ORTHEAST

!RGENTINA 'AS 0IPELINE PROJECT WHICH IS INTENDED TO TRANSPORT MILLION CUBIC METERS OF GAS A DAY FROM "OLIVIA TO !RGENTINA HAS IMMENSE ECONOMIC POTENTIAL FOR PRIVATE INVESTORS 0ROJECT ESTIMATES RISE FROM MILLION CUBIC METERS TO MILLION CUBIC METERS PER DAY IN GAS EXPORTS FROM "OLIVIA TO !RGENTINA AT A PRICE OF 53 PER MILLION "45 7ITH THIS NEW GAS VOLUME PERCENT OF THE !RGENTINE MARKET WILL BE SUPPLIED BY "OLIVIA 4HIS PROJECT WILL ENSURE NATURAL GAS SUPPLY TO THE NORTHERN AND CENTRAL REGIONS OF !RGENTINA

WHICH INCLUDES THE PROVINCES OF 3ALTA &ORMOSA #HACO -ISIONES

#ORRIENTES %NTRE 2ÓOS 3ANTA &E AND "UENOS !IRES

4HE POSTAL EXPORTING PROGRAM WAS INITIALLY IMPLEMENTED IN "RAZIL AND IT IS ANTICIPATED THAT MICROENTERPRISE AND SMALL AND MEDIUM BUSINESSES -3-%S WILL EXPORT 53 MILLION USING THIS FACILITY BY THE END OF 4HE PROJECT WILL ENHANCE THE COMPETITIVENESS OF -3-%S IN THE INTERNATIONAL MARKET CONTRIBUTING TO SUSTAINABLE DEVELOPMENT IN THE REGION THROUGH THE IMPLEMENTATION OF A 3IMPLIlED %XPORT 3YSTEM THROUGH 0OSTAL 3ERVICES 4HE IMPLEMENTATION OF THE PROJECT INCLUDES THE FOLLOWING ACTIVITIES ESTABLISHMENT OF A REGIONAL INTERINSTITUTIONAL COORDINATION NETWORK ADAPTATION OF LEGAL CUSTOM AND POSTAL REGULATION AS WELL AS THE LOGISTIC PROCESSES INVOLVED IN EXPORTS IDENTIlCATION OF THE SECTORS AND REGIONS WITH HIGHER POTENTIAL FOR EXPORTATION THROUGH THE NEW SERVICE ADAPTATION OF PUBLIC POSTAL INFRASTRUCTURE TO GUARANTEE A WIDE COVERAGE OF EXPORT SERVICES FOR -3-%S IMPLEMENTATION OF THE 3IMPLIlED %XPORT 3YSTEM TO BE OFFERED BY THE PUBLIC POSTAL OPERATOR COORDINATION OF THE INVOLVEMENT OF LOGISTIC AGENTS AND PRIVATE POSTAL OPERATORS IN PROJECT

4HE TRUNK GAS PIPELINE WILL BE KILOMETERS LONG AND INCHES IN DIAMETER AND IT WILL OPERATE UNDER A PRESSURE OF BARS 4HE PROJECT INCLUDES THE TRUNK GAS PIPELINE AND ITS PROVINCIAL BRANCHES AS WELL AS THE CORRESPONDING COMPRESSION REGULATION AND MEASUREMENT PLANTS

SURFACE INSTALLATIONS AND OTHER COMPLEMENTARY CIVIL ELECTRICITY AND COMMUNICATION WORKS SUCH AS DATA TRANSMISSION REMOTE OPERATION AND TELEMETRY 4HE TOTAL INVESTMENT IS ESTIMATED AT 53 BILLION 4HE PRIVATE SECTOR IS EXPECTED TO PROVIDE PERCENT OF THE INVESTMENT THROUGH A GAS TRANSPORTATION CONCESSION THAT WILL BE DETERMINED BY INTERNATIONAL PUBLIC BIDDING !T PRESENT THE PROJECT IS UNDER PREPARATION

IMPLEMENTATION AND AN INFORMATION CAMPAIGN DIRECTED TO -3-%S ABOUT THE BUSINESS OPPORTUNITIES OFFERED BY THE NEW SERVICE

))23! !.$ 4(% .%7 $9.!-)#3 /& ! #/.4).%.4

))23! AS AN )NGREDIENT TO 3TIMULATE 4RADE AND 'ROWTH 3OUTH !MERICA S INTRAREGIONAL TRADE IS STILL FAR FROM ITS CEILING AFTER TWO DECADES OF STRONG GROWTH ))23! S CHALLENGE IS TO HELP MOBILIZE THE APPROPRIATE HARDWARE AND SOFTWARE TO STRENGTHEN THE INTEGRATION PROCESS AND ACCELERATE THE EXPANSION OF TRADE AND ECONOMIC GROWTH )NTRAREGIONAL TRADE GREW FROM PERCENT OF THE REGION S TOTAL COMMERCE IN TO A PEAK OF PERCENT IN )T CURRENTLY STANDS AT ABOUT PERCENT OWING IN PART TO THE RAPID INCREASE OF OVERALL EXPORTS TO COUNTRIES OUTSIDE THE REGION SINCE AND A TEMPORARY CONTRACTION IN "RAZIL !RGENTINA TRADE /VERALL EXPORTS OF 3OUTH !MERICA INCREASED BY PERCENT DURING AND FOR MANY COUNTRIES BY CLOSE TO PERCENT 4HAT PROPORTION OF INTRAREGIONAL TRADE TO TOTAL TRADE IS NONETHELESS LOWER THAN IN %AST !SIA #HINA *APAN +OREA AND 4AIWAN

WHERE INTRAREGIONAL TRADE ACCOUNTS FOR PERCENT OF TOTAL TRADE AND WITH RESPECT TO THE %UROPEAN 5NION WHERE THE lGURE IS CLOSE TO PERCENT )T IS NOTEWORTHY THAT PART OF THE INTRA %UROPEAN TRADE RESULTS FROM THE ABILITY OF PORTS SUCH AS 2OTTERDAM AND !NTWERP TO ATTRACT CARGO FROM THE WHOLE CONTINENT 4HIS PATTERN REVEALS ONE WAY IN WHICH

INTRAREGIONAL TRADE CAN MAKE EXPORTS MORE AFFORDABLE INCREASING COMPETITIVENESS AND STRENGTHENING THE LINKS OF THE WHOLE REGION 3UCCESSFUL INTEGRATION WILL AVOID EXCESSIVE CONCENTRATION OF ECONOMIC ACTIVITIES 7HILE LOWERING THE COST FOR EXPORTS INFRASTRUCTURE INVESTMENT CAN PLAY A FUNDAMENTAL ROLE IN LEVELING OPPORTUNITIES FOR 3OUTH !MERICA AS A WHOLE

ESPECIALLY IN REMOTE AREAS ! BETTER SUPPLY OF TRANSPORTATION ENERGY AND COMMUNICATION CAN FOSTER THE GEOGRAPHIC DECONCENTRATION OF NEW BUSINESSES AND HELP REDUCE CONGESTION IN LARGE CITIES )T MAY ALSO REDUCE THE RISK OF A BACKLASH AGAINST TRADE OWING TO POORER AREAS FEELING THAT THEY WERE LEFT BEHIND 'EOGRAPHIC EXPANSION OF INDUSTRY AND OTHER ECONOMIC ACTIVITIES AS A RESULT OF BETTER ROADS AND LOWER ENERGY AND COMMUNICATIONS COSTS HAS BEEN WITNESSED FOR INSTANCE IN "RAZIL WHERE INDUSTRIAL OUTPUT HAS

-ORE INFRASTRUCTURE CAN LEVEL OPPORTUNITIES IN THE REGION

INCREASINGLY MOVED AWAY FROM 3ÎO 0AULO TO THE 3OUTH AND #ENTER REGIONS

CREATING NEW PATTERNS IN THE NATIONAL GEOGRAPHY OF INCOME DISTRIBUTION ,OWER TRADE TARIFFS HAVE GIVEN NEW PROMINENCE TO FREIGHT COSTS !VERAGE TARIFFS IN MOST 3OUTH !MERICAN COUNTRIES ARE NOW A FRACTION

OF WHAT THEY WERE TWO DECADES AGO AND CLOSE TO THE LOWEST IN THE DEVELOPING WORLD SEE &IGURE )N ADDITION SEVERAL COUNTRIES HAVE FREE TRADE AGREEMENTS AMONG THEMSELVES OR WITH COUNTRIES OFFERING SIGNIlCANT MARKETS SUCH AS THE 5NITED 3TATES )N THIS ENVIRONMENT

REDUCING FREIGHT COSTS BECOMES CRITICAL FOR TRADE EXPANSION 4HESE COSTS STILL ACCOUNT FOR TOO HIGH A SHARE OF THE COST OF IMPORTS 4HEY OFTEN REmECT THE TYPE OF INTRAREGIONAL TRANSPORTATION AVAILABLE MORE OFTEN ROAD THAN RAIL OR WATERBORNE AND THE CONDITIONS OF OPERATION SUCH AS ROAD MAINTENANCE AND THE TIME IT TAKES TO CROSS BORDERS &REIGHT COSTS ACCOUNT FOR PERCENT OF TOTAL IMPORTS OF ,ATIN !MERICA EXCLUDING -EXICO "Y COMPARISON FREIGHT ACCOUNTS FOR ONLY PERCENT OF THE VALUE OF THE MERCHANDISE IMPORTED BY THE 5NITED 3TATES AND ONLY PERCENT WORLDWIDE )N SEVERAL 3OUTH !MERICAN COUNTRIES THE COST OF FREIGHT EXCEEDS THAT OF TARIFFS BY FAR THE WEIGHTED AVERAGE FREIGHT RATE OF IMPORTS FROM NEIGHBORS TO "RAZIL IS EQUIVALENT TO PERCENT OF THE COUNTRY S IMPORTS FROM THESE PARTNERS WELL ABOVE THE PERCENT INTRAREGIONAL TARIFF

INVESTMENTS 3EVERAL STUDIES HAVE POINTED TO THE DECLINE IN WEAR AND TEAR OF TRUCKS AND ACCIDENTS WITH A VERY SIGNIlCANT NUMBER OF LIVES SAVED THAT RESULTS FROM BETTER ROAD CONDITIONS AND DUPLICATION OF HIGH TRAFlC ROADS ¬THE WIDENING OF A HIGHWAY WITH ONE LANE IN EITHER DIRECTION SO THAT IT WILL HAVE TWO LANES IN EITHER DIRECTION ! PRIME EXAMPLE OF THIS TYPE OF OPPORTUNITY IS THE CAPACITY EXPANSION OF THE TRUNK LINKING THE HEART OF "RAZIL -INAS 'ERAIS TO THE MAIN ECONOMIC CENTERS OF !RGENTINA AND TO THE 0ACIlC /CEAN THROUGH 6ALPARAÓSO IN #HILE "Y THE SAME TOKEN THE COMPLETION OF SELECTED SEGMENTS OF ROADS AND THE ENHANCEMENT OF SOME KEY TRANSPORTATION LANES IN THE !MAZON INCLUDING THE IMPROVEMENT OF PORTS AND WATERWAYS CAN HELP ALTER THE TRADE EQUATION IN THE REGION AND BRING PROSPERITY TO REMOTE AREAS ,OOKING FORWARD THE BROADER USE OF WATERWAYS IN THE SOUTHERN PART OF THE REGION ALSO HOLDS GREAT POTENTIAL FOR LOWER COSTS

4HE ))23! PRIORITY PORTFOLIO GIVES WEIGHT TO TRANSPORTATION PROJECTS AS A WAY TO MAXIMIZE DEVELOPMENT IMPACT 3TUDIES HAVE SHOWN HIGH RESPONSIVENESS OF TRADE TO LOWER TRANSPORTATION COSTS !

PERCENTAGE POINT CHANGE IN TRANSPORTATION COSTS TYPICALLY RESULTS IN A PERCENT CHANGE IN TRADE VOLUMES !LSO TRADE IS TYPICALLY STRONGER

%NERGY IS ALSO AT THE FOREFRONT OF REGIONAL INTEGRATION DEVELOPMENTS AND NEW FORMS OF TRADE 4HE REGION HAS ABUNDANT RESOURCES OF PETROLEUM NATURAL GAS COAL HYDROPOWER AND THE CAPACITY TO MAKE MUCH GREATER USE OF SOLAR POWER AND BIOFUELS BUT THE GEOGRAPHIC DISTRIBUTION OF THE RESOURCES IS UNEVEN 4HE LARGE HYDROELECTRIC INSTALLATIONS OF )TAIPÞ AND 9ACYRETÉ IN THE )GUA U ,A 0LATA BASIN ARE PRIME EXAMPLES OF DECADES LONG COOPERATION AMONG 3OUTH !MERICAN COUNTRIES IN EXPLORING AND SHARING RENEWABLE SOURCES OF ENERGY 0IPELINES ALSO TRAVERSE SEVERAL COUNTRIES AND INTERREGIONAL TRADE IN ELECTRICITY IS A LONG STANDING REALITY -ORE RECENTLY REGIONAL POWER COMPANIES HAVE CONSISTENTLY INVESTED IN NEIGHBORING COUNTRIES PROMOTING GAINS OF SCALE AND EFlCIENCY IN THE REGION 'AINS FROM PHYSICAL AND COMMERCIAL INTEGRATION OF POWER GENERATION SYSTEMS ACROSS THE CONTINENT ARISE FROM THE AVAILABILITY OF COMPLEMENTARY ENERGY SOURCES WHICH CAN BE USED FOR ACHIEVING OPTIMUM RESULTS BY MAKING USE OF SEASONAL AND GEOGRAPHIC PATTERNS 6IGOROUSLY ADDRESSING REGULATORY AND INSTITUTIONAL ISSUES IN THESE SECTORS AS WELL

)NTEGRATION OF POWER SYSTEMS A SOURCE OF ENERGY EFlCIENCY

0ROGRESS IN REGULATIONS AND OTHER hSOFTv ASPECTS OF INTEGRATION WILL ACCELERATE EFlCIENCY GAINS 7HILE ROADS AND OTHER INSTALLATIONS CAN BE SEEN AS PART OF THE HARDWARE FOR REGIONAL TRADE HARMONIZATION OF TARIFFS AND REGULATORY FRAMEWORKS CAN BE SEEN AS THE SOFTWARE THAT WILL ALLOW THE SYSTEMS TO RUN SMOOTHLY (ARMONIZATION NEEDS TO BE REmECTED IN THE SMOOTHER OPERATION OF SYSTEMS SUCH AS QUICKER BORDER CROSSINGS IN THE CASE OF ROADS AND WITH RESPECT TO PIPELINES ACCESSIBLE CLEARINGHOUSES FOR ENERGY MARKETS &OSTERING DOMESTIC AND INTRAREGIONAL COMPETITION THROUGH INDEPENDENT AND STRONG REGULATORY OVERSIGHT OF ROAD AND RAIL TRANSPORTATION IS ALSO ESSENTIAL IN INCREASING SUPPLY AND REDUCING FREIGHT CHARGES

IN COUNTRIES WITH BETTER PHYSICAL COMMUNICATIONS #OUNTRIES IN THE TOP QUARTILE OF TRANSPORTATION EFlCIENCY HAVE ON AVERAGE PERCENT MORE TRADE WITH THE 5NITED 3TATES THAN THOSE AT THE BOTTOM QUARTILE "ETTER ROADS HELP LOWER FREIGHT COSTS )N MORE DEVELOPED AREAS

ROAD CAPACITY EXPANSION CAN DELIVER A VERY ATTRACTIVE RETURN ON

&REIGHT IS COMPUTED AS A PROPORTION OF IMPORTS BECAUSE IT IS THE IMPORTER WHO TYPICALLY PAYS FOR IT AS MOST TRADE IS CONDUCTED ON A &/" #)& BASIS FREE ON BOARD FOR EXPORTS AND ;CUSTOMS= INSURANCE AND FREIGHT FOR IMPORTS

#LARK 8IMENA $AVID $OLLAR AND !LEJANDRO -ICCO h0ORT %FlCIENCY -ARITIME 4RANSPORT #OSTS AND "ILATERAL 4RADE v ."%2 7ORKING 0APER

))23! S 0OLICY &RAMEWORK 2ESPONSIBILITY AND 0REDICTABILITY 4HE POLICY FRAMEWORK PROVIDED BY ))23! RESPONDS TO THE DEMANDS OF MORE INVESTMENT IN INFRASTRUCTURE THAT SAFEGUARDS lSCAL RESPONSIBILITY AND ENHANCES PREDICTABILITY "Y TAKING INTO CONSIDERATION NATIONAL AND REGIONAL PRIORITIES ))23! HELPS IDENTIFY THE BENElTS OF INDIVIDUAL PROJECTS IN A MORE COMPREHENSIVE AND SYSTEMATIC WAY 4HIS ANALYSIS IS FUNDAMENTAL IN RANKING PROJECTS AND ATTRIBUTING PRIORITIES IN THE FACE OF BUDGET CONSTRAINTS 4HE ))23! APPROACH ALSO DEALS WITH THE INTERTWINED ISSUES OF PHYSICAL INVESTMENT

REGULATORY ENVIRONMENT AND OPERATIONAL ISSUES THAT ULTIMATELY DETERMINE THE REAL RETURN OF ANY INVESTMENT "Y DEVELOPING SEVERAL TOOLS TO IMPROVE PROJECT IMPLEMENTATION THE INITIATIVE IS REDUCING THE RISK OF SLIPPAGES REGARDING CONSTRUCTION SCHEDULES ENVIRONMENTAL MITIGATION MEASURES AND ACCURATE COST ESTIMATES 4HE COMBINATION OF THESE ELEMENTS IN ADDITION TO THE REQUIREMENT OF TRANSPARENCY HELPS ATTRACT PRIVATE INVESTMENT FURTHER REDUCING THE lSCAL IMPACT OF A COMPREHENSIVE INFRASTRUCTURE POLICY )N DEALING WITH REGIONAL INTEGRATION ))23!

ALSO PROVIDES A COORDINATION MECHANISM TO ADDRESS CHALLENGES SOMETIMES RAISED BY DIFFERENT LEVELS OF lSCAL EFFORTS REQUIRED BY DISTINCT COUNTRIES TO CONDUCT PROJECTS THAT HAVE FEATURES OF A COLLECTIVE GOOD ! FRAMEWORK TO DISCIPLINE INFRASTRUCTURE INVESTMENT AS OFFERED BY ))23!

MAY BE THE KEY TO ACHIEVE BALANCED GROWTH IN THE NEXT DECADE 0ROJECT SELECTION IMPLEMENTATION

MONITORING AND EVALUATION HAVE COME TO THE FOREGROUND AS A CONSEQUENCE OF THE INCREASED DESIRE FOR HIGHER PUBLIC AND PRIVATE INVESTMENT IN INFRASTRUCTURE #HOOSING PRIORITIES AND EXPANDING THE RANGE OF MODALITIES ARE FUNDAMENTAL TO ACHIEVING A MAXIMUM RETURN ON THE INVESTMENT OF PUBLIC RESOURCES EVEN WHEN THEY BECOME MORE ABUNDANT "OX )NDEED DEVELOPING AND ADOPTING POLICY INSTRUMENTS TO HELP INCREASE GOOD QUALITY INFRASTRUCTURE INVESTMENT HAS BECOME ONE OF THE MAIN CHALLENGES FOR GOVERNMENTS IN THE REGION IN A PERIOD OF STRONGER lSCAL REVENUES 4HIS CHALLENGE HAS BEEN EMBRACED BY SEVERAL MULTILATERAL lNANCIAL INSTITUTIONS INCLUDING THE )$"

WHICH FOR MANY YEARS HAS ASSISTED MOST ,ATIN !MERICAN COUNTRIES WITH LOANS GRANTS AND TECHNICAL ASSISTANCE TO IMPROVE lSCAL MANAGEMENT OF PUBLIC INVESTMENT RESOURCES 4HE )NTERNATIONAL -ONETARY &UND )-& IS CONDUCTING A PILOT PROGRAM IN THIS AREA WITH "RAZIL #HILE AND #OLOMBIA AMONG OTHER COUNTRIES 4HE MAIN OBJECTIVE OF THIS PILOT PROGRAM IS TO CREATE CONDITIONS TO ENSURE THAT INFRASTRUCTURE INVESTMENT PROJECTS YIELD A RATE OF RETURN THAT EXCEEDS THE COST OF lNANCING OF THE PUBLIC SECTOR AS MEASURED BY THE YIELD OF THE PUBLIC DEBT 4HE )-& HAS ALSO DEVELOPED A SPECIAL MECHANISM WITHIN ITS PROGRAM ARRANGEMENTS WITH 0ERU BUILT ON THE PROGRESS MADE BY THIS COUNTRY IN IMPROVING THE SELECTION OF INVESTMENT PROJECTS

! FRAMEWORK TO DISCIPLINE INVESTMENT IN INFRASTRUCTURE

LIKE ))23!

IS A KEY TO BOOST ECONOMIC GROWTH

"OX 0OSSIBLE 0OLICY )NSTRUMENTS TO (ELP )NCREASE 4OTAL

)NFRASTRUCTURE )NVESTMENT 0RIVATE )NVESTMENT

0UBLIC )NVESTMENT

3HORT TO -EDIUM 4ERM s 5SE PUBLIC PRIVATE PARTNERSHIP s 2EALLOCATE PUBLIC EXPENDITURE s 0ROVIDE GOVERNMENT GUARANTEES s )MPLEMENT TAX POLICY MEASURES s 2ELAX lSCAL TARGETS lNANCED

BY DEBT OR THE SALE OF STATE ASSETS s #ARRY OUT STRUCTURAL REFORMS

-EDIUM TO ,ONG 4ERM s )MPLEMENT IMPROVEMENTS IN MARKET SUPPORTING INSTITUTIONS INCLUDING CIVIL SERVICE REFORM AND SOCIAL SECURITY THAT HELP STRENGTHEN THE RULE REFORM TO HELP REDUCE OF LAW PROPERTY RIGHTS AND THE REGULATORY FRAMEWORK CURRENT EXPENDITURE s $EEPEN lNANCIAL MARKETS s )MPROVE TAX ADMINISTRATION AND EXPENDITURE MANAGEMENT SYSTEMS TO IMPROVE EFlCIENCY

3OURCE -& 0UBLIC )NVESTMENT AND &ISCAL 0OLICYˆ,ESSONS FROM THE 0ILOT #OUNTRY 3TUDIES

&IGURE %VOLUTION OF %LECTRIC 0OWER IN 3OUTH !MERICA

&IGURE %VOLUTION OF 0ROVED 'AS 2ESERVES IN 3OUTH !MERICA

!

"

3OURCE #)%2 2EPORT

.OTE 3OUTH !MERICA RESERVES AMOUNT TO OF WORLD RESERVES 3OURCE #)%2 2EPORT

AS lNDING INNOVATIVE WAYS TO lNANCE NEW INFRASTRUCTURE PROJECTSˆ SUCH AS HYDROPOWER GENERATION PLANTS TRANSMISSION LINES PIPELINES AND LIQUIlED NATURAL GAS FACILITIESˆIS RECOGNIZED AS A FUNDAMENTAL STEP TO PROVIDE IMPETUS TO FURTHER INTEGRATION IN THESE SECTORS

)$" SUPPORTED THE PROJECT WITH A 53 MILLION DOLLAR GUARANTEE THAT PROMOTED COMPETITION IN THE BIDDING PROCESS AND ENSURED PAYMENTS BY THE GOVERNMENT TO THE PRIVATE OPERATOR SEE "OX PAGE

2AILWAYS

PORTS AND LOGISTICS ARE NOW VIBRANT SECTORS

))23! FOCUS ON PRIVATE SECTOR OPPORTUNITIES REmECTS ON MARKET FORCES IN THE REGION IN THE PAST YEARS !S GOVERNMENTS CONTROLLED INmATION AND ADDRESSING lSCAL IMBALANCES BECAME A PRIORITY

THE PARTICIPATION OF THE PRIVATE SECTOR IN DEVELOPING THE REGION S INFRASTRUCTURE BECAME PART OF THE AGENDA AND COMPLEMENTED OTHER EFFORTS TO LIBERALIZE ECONOMIES AND INCREASE COMPETITIVENESS %FFORTS BY -%2#/352 THE 3OUTH !MERICAN #OMMON -ARKET AND THE !NDEAN #OMMUNITY TO DEVELOP COMMON POLICIES AND REGULATIONS AND FOSTER ECONOMIC CONVERGENCE FURTHER CONTRIBUTED TO THIS CHANGE !LSO CROSS BORDER INVESTMENT

BY PRIVATE COMPANIES IN THE REGION BECOME INCREASINGLY COMMON

REmECTING A VERY IMPORTANT ASPECT OF REGIONAL INTEGRATION .EWS ABOUT #OLOMBIAN COMPANIES INVESTING IN "RAZIL "RAZILIAN COMPANIES INVESTING IN !RGENTINA AND #HILE AND #HILEAN COMPANIES INVESTING IN NEIGHBORING COUNTRIES HAVE BECOME A REGULAR FEATURE IN THE BUSINESS PRESS

))23! AND THE 0RIVATE 3ECTOR 4HE PRIVATE SECTOR PLAYS A PROMINENT ROLE IN THE ))23! INITIATIVE 0RIVATE lRMS REGULARLY BID ON CONTRACTS RESULTING FROM INFRASTRUCTURE WORKS AND FOUR OF THE PRIORITY PROJECTS IN THE #ONSENSUS !GENDA ARE WORKS THAT WILL BE COMPLETED BY PRIVATE CONCESSIONAIRES INCLUDING THE REACTIVATION OF THE STRATEGIC RAILROAD LINKING ,OS !NDES #HILE WITH -ENDOZA !RGENTINA 0RIVATELY OWNED AND OPERATED TOURISM FACILITIES

MANUFACTURING AND SERVICES WILL BENElT FROM THE INCREASE IN ECONOMIC ACTIVITY AND REGULATORY HARMONIZATION IN THE AREAS OF INmUENCE OF THE ))23! HUBS AND BEYOND )N THE POLICYMAKING AREA PRIVATE SECTOR REPRESENTATIVES ATTEND MEETINGS OF ))23! S %XECUTIVE 4ECHNICAL 'ROUPS

THE TASK FORCES THAT MAKE RECOMMENDATIONS ON SPECIlC ISSUES SUCH AS REGULATORY STANDARDIZATION AND PROJECT DEVELOPMENT 4HE PRIVATE SECTOR MAY SUBMIT CONCRETE PROPOSALS FOR ACTION THROUGH ))23! S .ATIONAL #OORDINATORS OR THROUGH MULTILATERAL DEVELOPMENT INSTITUTIONS 4HE PRIVATE SECTOR IS A PRIMARY STAKEHOLDER IN MAKING CROSS BORDER TRANSPORTATION AND COMMUNICATION MORE EFlCIENT AND IS CONSULTED ON ISSUES OF REGULATORY HARMONIZATION 0UBLIC PRIVATE PARTNERSHIPS WILL BE A VEHICLE OF CHOICE IN MOVING THE ))23! AGENDA FORWARD !N EXAMPLE OF THIS KIND OF COOPERATION IS THE BIDDING PROCESS FOR A PRIVATE CONCESSIONAIRE FOR THE CONSTRUCTION OPERATION AND MAINTENANCE OF THE ))23! .ORTE 0AITA 0IURA 9URIMAGUAS TOLL ROAD CORRIDOR IN THE .ORTHERN !MAZON (UB 4HE

2AILWAYS PORTS AND LOGISTICAL SERVICES ARE AMONG THE SECTORS THAT OFFER OPPORTUNITIES FOR PRIVATE INVESTMENT UNDER THE ))23!

&IGURE -&. 4ARIFFS ,IBERALIZATION VARIOUS YEARS 3OUTH !MERICA !SIA AND -EXICO IN PERCENT

.OTES 4HE COUNTRIES INCLUDED IN 3OUTH !MERICA ARE !RGENTINA

"OLIVIA "RAZIL #HILE #OLOMBIA

%CUADOR 0ERU 0ARAGUAY

5RUGUAY AND 6ENEZUELA 4HE COUNTRIES INCLUDED IN !SIA ARE #HINA )NDONESIA AND -ALAYSIA 'IVEN THE CONSTRAINTS IN DATA FOR YEAR 3OUTH !MERICA ONLY CONSIDERS "RAZIL AND !SIA ONLY CONSIDERS )NDONESIA 3OURCE )$" CALCULATIONS BASED ON 5NCTAD 4RAINS DATABASE

INITIATIVE )NCREASING PRIVATE INVESTMENT IN THE RAIL SECTOR HAS HELPED

TO GROW IN THE WAKE OF THE IMPLEMENTATION OF THE ))23! HUBS /N THE

BRING TO LIFE ONCE MORIBUND RAILROAD SYSTEMS AND PRIVATELY OPERATED

INSTITUTIONAL SIDE THE PRIVATE SECTOR IS OFTEN ACTIVE AS AN ADVOCATE FOR

PORTS HAVE DEMONSTRATED IMPORTANT EFlCIENCIES &URTHER OPPORTUNITIES

GREATER REGULATORY STANDARDIZATION EFlCIENCY AND TRANSPARENCY ,OOKING

ARE PART OF THE ))23! PORTFOLIO OF PROJECTS 4RANSPORTED CARGO GREW AN

FORWARD GROWING COMPETITION AMONG PRIVATE INVESTORS AND OPERATORS TO

AVERAGE OF PERCENT BETWEEN AND IN !RGENTINA "RAZIL

CREATE EFlCIENCIES AND APPLY NEW TECHNOLOGIES WILL HELP TO ACHIEVE

AND #HILE !LSO PRIVATE LOGISTICAL AND COMMERCIAL SERVICES WILL CONTINUE

FURTHER REDUCTIONS IN COSTS AND INCREASE THE SUPPLY OF SERVICES

)MPROVING CROSS BORDER TIME CAN INCREASE FREIGHT SUPPLY ! TYPICAL TRIP BY TRUCK FROM 3ÎO 0AULO TO 3ANTIAGO CAN TAKE HOURS OF WHICH ONLY HOURS WILL ACTUALLY BE SPENT TO COVER THE

KILOMETERS SEPARATING THE TWO CITIES 4HE REMAINING THIRD OF THE TRIP IS OFTEN SPENT AT BORDERS "RAZIL !RGENTINA AND !RGENTINA #HILE 4HIS IS NOT UNIQUE TO THIS ROUTE )T IS COMMON FOR ROAD CARGO TRAFlC TO WAIT FOR DAYS AT OTHER BORDER AREAS AS WELL 2EDUCING IDLE TIME CAN INCREASE THE PRODUCTIVITY OF TRUCKS BY UP TO PERCENT IN ADDITION TO REDUCING THE RISK OF GOODS BEING DAMAGED OR STOLEN ! MODEST AMOUNT OF INVESTMENT IN WEIGHING STATIONS AND CUSTOMS OFlCES AS WELL AS SIMPLER PROCEDURES SUCH AS SINGLE CHECKS ON JUST ONE SIDE OF THE BORDER CAN HAVE A SUBSTANTIAL EFFECT IN REDUCING IDLE TIME 4ABLE 3UCH STEPS WOULD LEVERAGE THE PROGRESS ACHIEVED SO FAR IN OTHER REGULATORY ISSUES SUCH AS UNIFORMITY OF WEIGHT STANDARDS AND CLASSIlCATION OF HAZARDOUS MATERIALS 4ABLE 4IMES AND 0ROCEDURES AT THE $ESAGUADERO "ORDER 0ASS 7ITHOUT THE PROJECT

7ITH THE PROJECT

0ROCEDURE "OLIVIA

0ERU

"OLIVIA

0ERU

4RANSIT FROM TO THIRD COUNTRIES

HOURS

HOURS

MINUTES

MINUTES

)MPORT TRANSIT

HOURS

HOURS

MINUTES

MINUTES

%XPORT TRANSIT

HOURS

HOURS

MINUTES

MINUTES

7AITING 4IMES AT THE $ESAGUADERO "ORDER 0ASS 0ROCEDURE

7ITHOUT THE PROJECT "OLIVIA

0ERU

"OLIVIA

0ERU

/UTGOING WAITING TIME

HOURS

HOURS

HOURS

HOURS

)NCOMING WAITING TIME

HOUR

HOUR

HOURS

HOURS

3OURCE )$"

7ITH THE PROJECT

"OX 4HE ))23! .ORTE )$" 'UARANTEE FOR 0UBLIC 0RIVATE 0ARTNERSHIP

/N !UGUST

THE PRIVATE ROAD OPERATOR ))23! .ORTE IN 0ERU mOATED 53 MILLION IN BONDS TO lNANCE A PROJECT BACKED BY AN INNOVATIVE )$" GUARANTEE OF 53 MILLION IN THE CONTEXT OF A PUBLIC PRIVATE PARTNERSHIP SUPPORTING A MAJOR ))23! PROJECT 4HE ROLLING REINSTALLABLE PARTIAL CREDIT GUARANTEE THE lRST BY THE )$" TO THE PUBLIC SECTOR SERVED AS AN ENHANCEMENT TO THE EXPECTED 53 MILLION PRIVATE INVESTMENT FOR THE IMPROVEMENT AND REHABILITATION OF A KILOMETER PRIVATELY OPERATED TOLL ROAD SYSTEM LINKING THE PORT OF 0AITA ON 0ERU S NORTHERN 0ACIlC COAST TO THE PORT OF 9URIMAGUAS ON THE (UALLAGA 2IVER A MAIN TRIBUTARY OF THE !MAZON 4HE GUARANTEE WILL SUPPORT DEFERRED GOVERNMENT ANNUAL PAYMENTS TO THE CONCESSIONAIRE #ONCESIONARIA ))23! .ORTE OVER A YEAR PERIOD 4HE GUARANTEE WHICH WILL BE CONVERTED INTO SOVEREIGN DEBT IN THE EVENT OF A LAPSE IN PAYMENT TO THE CONCESSIONAIRE BY THE GOVERNMENT REQUIRED THE DEVELOPMENT OF NEW WAYS FOR THE "ANK TO STRUCTURE ITS lNANCIAL PARTICIPATION AS WELL AS THE CREATION OF NEW LEGAL DOCUMENTATION 4HIS INNOVATIVE lNANCIAL STRUCTURE INDUCED GREATER COMPETITION IN THE BIDDING TO SELECT A PRIVATE CONCESSIONAIRE FOR THE PROJECT AND FACILITATED THE BOND PLACEMENT 4HE OPERATION DEMONSTRATED THAT PARTIAL CREDIT GUARANTEES ARE WELL SUITED TO PUBLIC PRIVATE PARTNERSHIPS 4HEY ARE EASY TO UNDERSTAND

RELATIVELY INEXPENSIVE AND HAVE POSITIVE MARKET ACCEPTANCE 4HE PRIMARY 5 3 RATING AGENCIES CONSIDER THAT THE PRESENCE OF A PARTIAL CREDIT GUARANTEE TYPICALLY RESULTS IN AT LEAST A SINGLE NOTCH INCREASE IN THE RATING OF THE UNDERLYING CREDIT INSTRUMENT

&IGURE )NVESTMENTS IN "RAZILIAN RAILWAYS 2 MILLION

&IGURE 2AILWAY FREIGHT TRANSPORTATION IN !RGENTINA

"RAZIL AND #HILE -ILLIONS OF TONS PER YEAR

2 -ILLION

!

!

!

3OURCES !RGENTINA )NSTITUTO DE %STADÓSTICA Y #ENSOS DE LA 2EPÞBLICA DE !RGENTINA

"RAZIL !.44 !GENCIA .ACIONAL DE 4RANSPORTE 4ERRESTRE

#HILE )NSTITUTO .ACIONAL DE %STADÓSTICAS DE #HILE

4ABLE ))23! )NVESTMENT /PPORTUNITIES FOR THE 0RIVATE 3ECTOR

.O

.!-%

(5"

53 -ILLION

3%#4/2

4RANSMISSION ,INE 9ACYRETÉ "UENOS !IRES

-%2#/352 #HILE

%NERGY

#OMBINED CYCLE THERMOELECTRIC UNIT 3AN *OSÏ

-%2#/352 #HILE

%NERGY

#ONSTRUCTION OF #ORPUS #HRISTI (YDROELECTRIC 0OWER 0LANT

-%2#/352 #HILE

%NERGY

#ONSTRUCTION OF (YDROELECTRIC 0OWER 0LANT OF 'ARABI

-%2#/352 #HILE

%NERGY

'AS 0IPELINE OF.ORESTE !RGENTINO

-%2#/352 #HILE

%NERGY

2AILWAY 0ROJECT OF ,OS !NDES #HILE -ENDOZA !RGENTINA 4RANSANDEAN 2AILWAY

-%2#/352 #HILE

4RANSPORT

"AYØVAR 0ORT

!MAZON

4RANSPORT

2EHABILITATION OF ,IMA 4INGO -ARÓA 0UCALLPA 2OAD

0ORTS AND ,OGISTIC #ENTERS

!MAZON

4RANSPORT

0UCALLPA !IRPORT

!MAZON

4RANSPORT

-ANTA 0ORT

!MAZON

4RANSPORT

0AITA 0ORT

!MAZON

4RANSPORT

"OGOTÉ "ELTWAY

!NDEAN

4RANSPORT

)MPROVEMENT IN "OGOTÉ n 'IRARDOT n )BAGUÏ 2OAD

!NDEAN

4RANSPORT

2OUTES AND WITH THE BYPASS OF #HICLAYO Y 4RUJILLO

!NDEAN

4RANSPORT

'AS 0IPELINES 0ROJECTS

!NDEAN

%NERGY

2EHABILITATION AND #ONSTRUCTION IN THE ELECTRIC INTERCONECTIONS OF #UATRICENTENARIO #UESTECITAS AND EL #OROZO 3AN -ATEO

!NDEAN

%NERGY

#ONSTRUCTION OF (YDROELECTRIC 0OWER 0LANT -ADEIRA 2IVER #OMPLEX

0ERU "RAZIL "OLIVIA

%NERGY

4RANSMISSION LINES FROM -ADEIRA 2IVER #OMPLEX TO THE BRAZILIAN CENTRAL SYSTEM

0ERU "RAZIL "OLIVIA

%NERGY

#ONSTRUCCION )NTERCONEXION A +V 2EGION #OMEHUE #UYO

3OUTHERN

%NERGY

&ERROANEL DE 3AO 0AULO TRAMO NORTE E SUL

#ENTRAL )NTEROCEANIC

4RANSPORT

4/4!,

SOURCE ))23! S 0ROJECTS 0ORTFOLIO

))23! !.$ 4(% )$"

SECTORˆAND THE )NTER !MERICAN )NVESTMENT #ORPORATION WHICH PROVIDES LOANS GUARANTEES AND INVESTMENTS TO SUPPORT SMALL AND MEDIUM SIZED BUSINESSES &OR A MORE DETAILED DESCRIPTION OF )$" OPERATIONS SEE WWW IADB ORG

4HE )$" SUPPORTS ))23! WITH A RANGE OF lNANCIAL AND NONlNANCIAL INSTRUMENTS INCLUDING LOANS GRANTS GUARANTEES AND TECHNICAL ASSISTANCE 4HE "ANK TOGETHER WITH #!& AND &/.0,!4!

IS ONE OF THE THREE INSTITUTIONAL MEMBERS OF ))23! S 4ECHNICAL #OORDINATION #OMMITTEE THAT COORDINATES TECHNICAL SUPPORT DEVELOPS MANAGEMENT TOOLS AND lNANCES STUDIES 4HE )$" HAS BEEN COMMITTED TO INTEGRATION OF THE !MERICAS SINCE ITS FOUNDING CHARTER IN AND IN IN AN AGREEMENT WITH !RGENTINA THE "ANK CREATED THE )NSTITUTE FOR THE )NTEGRATION OF ,ATIN !MERICA AND THE #ARIBBEAN ).4!, ,OCATED IN "UENOS !IRES ).4!, HAS CARRIED OUT MULTIPLE ACTIVITIES TO SUPPORT INTEGRATION FOR MORE THAN FOUR DECADES INCLUDING RESEARCH PUBLICATIONS

TRAINING AND TECHNICAL ASSISTANCE FOR GOVERNMENTS ACADEMIA AND THE PRIVATE SECTOR ).4!, S OFlCES IN "UENOS !IRES ARE IN THE SAME BUILDING AS THOSE OF THE )$" AND SERVE AS THE SITE OF THE PERMANENT 3ECRETARIAT OF ))23! S 4ECHNICAL #OORDINATION #OMMITTEE

.EW MEASURES TAKEN BY THE "ANK WILL BENElT ))23! AND OTHER LENDING PROGRAMS THROUGH STREAMLINED PROCEDURES AND MORE mEXIBLE POLICIES 4HE )$" DURING ADOPTED NEW POLICIES TO ENABLE IT TO DISBURSE FUNDS IN LOCAL CURRENCIES UNDER SOME CONDITIONS

APPLY NEW MORE mEXIBLE lNANCIAL INSTRUMENTS AND HARMONIZE PROGRAMS WITH OTHER DEVELOPMENT AGENCIES WHILE RELYING MORE ON NATIONAL PROCUREMENT AND EVALUATION SYSTEMS &OR THE lRST TIME THE )$" IN AUTHORIZED A PERCENTAGE OF ITS LOANS TO BE MADE DIRECTLY TO SUBNATIONAL GOVERNMENTSˆSUCH AS MUNICIPALITIES AND PROVINCESˆ WITHOUT SOVEREIGN NATIONAL GUARANTEES !T THE SAME TIME MOST RESTRICTIONS ON THE CATEGORIES OF LENDING TO THE PRIVATE SECTOR WITHOUT GOVERNMENT GUARANTEES WERE LIFTED )NFRASTRUCTURE WAS IDENTIlED AS ONE OF THE STRATEGIC PRIORITY AREAS OF INVESTMENT AND PILOT PROJECTS UNDER

4HE )$" HAS MADE SIGNIlCANT INVESTMENTS IN THE REGION S INFRASTRUCTURE AND FOREIGN TRADE CAPACITY IN THE PAST YEARS /F THE 53 BILLION IN LOANS APPROVED FROM THROUGH THE END OF

THE )$" PROVIDED 53 BILLION IN lNANCING FOR ENERGY PROJECTS AND 53 BILLION FOR TRANSPORTATION AND COMMUNICATIONS )N THAT SAME PERIOD IT ALSO APPROVED 53 BILLION IN TRADE lNANCING )N ALONE THE "ANK APPROVED 53 MILLION IN LOANS FOR TRADE SUPPORT PROJECTS )N THE AREA OF PRIVATE SECTOR lNANCING THE )$" THROUGH ITS 0RIVATE 3ECTOR $EPARTMENT IS THE WORLD S LARGEST lNANCIER OF PRIVATE SECTOR PROJECTS WITHOUT GOVERNMENT GUARANTEES IN ,ATIN !MERICA AND THE #ARIBBEAN 4HE "ANK ALSO SUPPORTS THE PRIVATE SECTOR THROUGH SISTER INSTITUTIONS IN THE )$" GROUP THE -ULTILATERAL )NVESTMENT &UND

ˆTHE REGION S LARGEST SOURCE OF TECHNICAL ASSISTANCE TO THE PRIVATE

A NEW REGIONWIDE "ANK INITIATIVE "UILDING /PPORTUNITY FOR THE -AJORITY

LAUNCHED IN *UNE WHICH SEEKS MORE EFFECTIVE WAYS TO BRING THE BENElTS OF GROWTH TO THAT PERCENT OF THE POPULATION OF ,ATIN !MERICA AND THE #ARIBBEAN THAT EARNS 53 A YEAR OR LESS 4HE "ANK IS ALREADY INVOLVED IN THE lNANCING OF ONE THIRD OF THE PROJECTS IN THE PROJECT ))23! PRIORITY PORTFOLIO )N ADDITION THE )$" HAS PROVIDED 53 MILLION IN GRANTS TO lNANCE MEETINGS STUDIES AND OTHER ))23! ACTIVITIES FROM THROUGH MID !LTHOUGH MOST ))23!

COUNTRIES HAVE INCREASINGLY EASIER ACCESS TO CREDIT MARKETS lNANCIAL AND TECHNICAL SUPPORT FROM MULTILATERAL lNANCIAL INSTITUTIONS OFFERS UNIQUE

))23! AND THE )$" -ITIGATING 3OCIAL AND %NVIRONMENTAL 2ISKS

4HE "ANK TAKES A PROACTIVE APPROACH WHEN CONSIDERING THE ENVIRONMENTAL AND SOCIAL DIMENSIONS OF INFRASTRUCTURE PROJECTS &ROM THE TIME AN INFRASTRUCTURE PROJECT WHETHER ASSOCIATED WITH ))23! OR NOT IS lRST SUBMITTED TO THE )$" FOR POSSIBLE lNANCING ITS POTENTIAL ENVIRONMENTAL AND SOCIAL IMPACTS ARE TRACKED AND ADDRESSED 4HE "ANK S #OMMITTEE ON %NVIRONMENTAL AND 3OCIAL )MPACT #%3) REVIEWS AN INITIAL %NVIRONMENTAL AND 3OCIAL 3TRATEGY DOCUMENT WHICH IS PUBLISHED ON THE "ANK S WEBSITE WWW IADB ORG 5NDER THE TERMS OF THE "ANK S %NVIRONMENTAL AND 3AFEGUARDS #OMPLIANCE 0OLICY !UGUST THE #%3) SCREENS THE PROPOSED OPERATION TO DETERMINE ITS COMPLIANCE NOT JUST WITH THE DIRECTIVES OF THIS POLICY BUT ALSO WITH OTHER "ANK SECTOR SPECIlC OPERATIONAL POLICIES AND THE PROVISIONS OF CROSS SECTORAL POLICIES RELATED TO SOCIAL AND ENVIRONMENTAL IMPACTS SUCH AS THOSE ON )NVOLUNTARY 2ESETTLEMENT

.ATURAL AND 5NEXPECTED $ISASTERS 0OLICY )NDIGENOUS 0EOPLES AND )NFORMATION $ISCLOSURE ! SPECIlC DIRECTIVE OF THE %NVIRONMENTAL AND 3AFEGUARDS #OMPLIANCE 0OLICY REQUIRES THE IDENTIlCATION OF POTENTIAL TRANSBOUNDARY ISSUES ASSOCIATED WITH A PROPOSED OPERATION EARLY IN THE PROJECT CYCLE %XAMPLES OF TRANSBOUNDARY ISSUES CITED IN THE DIRECTIVE INCLUDE IMPACTS ON ANOTHER COUNTRY S USE OF WATERWAYS

WATERSHEDS COASTAL MARINE RESOURCES BIOLOGICAL CORRIDORS AND REGIONAL AIRSHEDS AND AQUIFERS !S PART OF ITS INITIAL SCREENING OF ALL PROPOSED OPERATIONS THE #%3) CLASSIlES PROJECTS AS BELONGING TO EITHER #ATEGORY h!v #ATEGORY h"v OR #ATEGORY h# v &OR #ATEGORY h!v PROJECTS DElNED AS THOSE PROPOSED OPERATIONS THAT hARE LIKELY TO CAUSE SIGNIlCANT NEGATIVE ENVIRONMENTAL AND ASSOCIATED CULTURAL IMPACTS WHETHER DIRECT INDIRECT REGIONAL OR CUMULATIVEv THE "ANK REQUIRES THE PREPARATION OF ENVIRONMENTAL ASSESSMENT DOCUMENTATION NORMALLY AN %NVIRONMENTAL )MPACT !SSESSMENT %)! &OR PROPOSED OPERATIONS WITH PARTICULARLY COMPLEX AND SENSITIVE ENVIRONMENTAL SOCIAL OR HEALTH AND SAFETY CONCERNS THE "ANK SUGGESTS THAT THE BORROWER BE IT PUBLIC OR PRIVATE ESTABLISH AN ADVISORY PANEL OF EXPERTS TO PROVIDE GUIDANCE FOR THE DESIGN AND EXECUTION OF THE PROJECT #ATEGORY h!v AND h"v PROJECTS REQUIRE CONSULTATIONS BY THE "ANK AND THE PROSPECTIVE BORROWER WITH AFFECTED PARTIES AND CONSIDERATION OF THEIR VIEWS !DDITIONAL PUBLIC CONSULTATIONS AND INFORMATION DISCLOSURE ARE EXPECTED TO CONTINUE FOLLOWING COMPLETION OF THE ENVIRONMENTAL ASSESSMENT PROCESS EXTENDING THROUGH IMPLEMENTATION OF THE PROJECT IN ACCORDANCE WITH THE PROVISIONS OF AN %NVIRONMENTAL AND 3OCIAL -ANAGEMENT 0LAN %3-0 AGREED TO BETWEEN THE "ANK AND THE BORROWER /VERALL THE )$" S GOAL IS NOT ONLY TO MEET THE STANDARDS OF NATIONAL LEGISLATION INTERNATIONAL RULES AND ITS OWN POLICIES BUT ALSO TO ENRICH THE PROJECT AND STRENGTHEN NATIONAL AND REGIONAL ENVIRONMENTAL AND SOCIAL STANDARDS 4HE )$" SETS GREAT STORE BY THE APPLICATION OF EXPERIENCES AND EXPERTISE OF BORROWERS BOTH GOVERNMENTAL AND THE PRIVATE SECTOR AND OTHER STAKEHOLDERS IN TECHNICAL SOCIAL AND ENVIRONMENTAL DESIGN AND PROTECTION MECHANISMS )N ALL INSTANCES THE "ANK SEEKS TO ENCOURAGE USE OF THE HIGHEST STANDARDS AND THE BEST PRACTICES AMONG ALL PARTIES IN A PROPOSED OPERATION SO THAT CO lNANCING ENTITIES ADOPT A SINGLE ENVIRONMENTAL AND SOCIAL ASSESSMENT PROCESS AND UNIlED DOCUMENTATION CONSULTATION AND DISCLOSURE REQUIREMENTS )N THE CONTEXT OF INDIVIDUAL OPERATIONS

THE "ANK WILL CONSIDER THE USE OF BORROWING MEMBER COUNTRIES EXISTING SAFEGUARDS SYSTEMS WHEN THE "ANK HAS DETERMINED THAT THE COUNTRY S SYSTEM IS EQUIVALENT OR SUPERIOR TO THE "ANK S

4ABLE ))23! 0ROJECTS &INANCED OR IN THE )$" 0IPELINE -ILLIONS OF 53 0ROJECT

(5"

#OUNTRIES

3TAGE

4OTAL

)$"

0AITAn9URIMAGUAS 2OAD 0ORTS AND ,OGISTIC #ENTERS

!MAZON

0% "2

)N EXECUTION

2EHABILITATION AND #ONSTRUCTION OF 0ASTOn-OCOAn2OAD

!MAZON

#/

0IPELINE

#ONSTRUCTION AND )MPLEMENTATION OF THE $ESAGUADERO "ORDER #ENTER

!NDEAN

0% "/

0IPELINE

./! .%! %LECTRICAL )NTERCONNECTION 0HASES AND

#APRICORN

!2

!PPROVED

0AVING 4ARTAGALn-ISIØN ,A 0AZn0OZA (ONDAn -ARISCAL %STIGARRIBIA

#APRICORN

02 !2

)N EXECUTION

#ONSTRUCTION OF 3ALVADOR -AZZA !2 n9ACUIBA "/ "INATIONAL "RIDGE AND "ORDER #ENTER

#APRICORN

!2 "/

0IPELINE

!CCESS 2OAD TO #ISCO "ORDER #ROSSING

#APRICORN

!2

0IPELINE

#ONSTRUCTION OF 2OUTE #AAZAPAn#ORONEL "OGADO 3TRETCH

#APRICORN

02 !2

0IPELINE

)MPROVEMENT OF 'EORGETOWNn!LBINA 2OAD

'UIANESE 3HIELD

'9

)N EXECUTION

#ENTRAL )NTEROCEANIC

"/

)N EXECUTION

#ONSTRUCTION OF 0AILØNn3AN *OSÏn0ORT 3UÉREZ 2OAD

$UPLICATION OF 2OUTE

-%2#/352 #HILE

!2

)N EXECUTION

$UPLICATION OF THE 0ALHO An/SORIO 3TRETCH

-%2#/352 #HILE

"2

0IPELINE

2EMODELING OF THE 2ÓO "RANCOn-ONTEVIDEOn#OLONIAn .UEVA 0ALMIRA #ORRIDOR

-%2#/352 #HILE

59

)N EXECUTION

-ONTEVIDEO 0ORT -ODERNIZATION

-%2#/352 #HILE

59

0IPELINE

#ONSTRUCTION OF 'UAYARAMERÓNn2IBERALTAn9UCUMOn ,A 0AZ 2OAD 'UAYAMERÓN 'UAJARÉ -IRÓN "INATIONAL "RIDGE

0ERU n "RAZIL n "OLIVIA

"/ "2

)N EXECUTION

4OTAL

ASSISTANCE IN DEVELOPING COMPLEX INFRASTRUCTURE PROJECTS )$" LOANS FOR ))23! PROJECTS REPRESENTING TOTAL INVESTMENTS OF ALMOST 53 BILLON HAVE BEEN APPROVED OR ARE IN THE "ANK S LENDING PIPELINE 4HE )$" SHARE OF THESE PROJECTS IS ESTIMATED AT NEARLY 53 BILLION

WHILE THE OTHER 53 BILLION CORRESPONDS TO GOVERNMENT COUNTERPART lNANCING 3EE 4ABLE 4HE )$" COORDINATES ITS LENDING PROGRAM WITH #!& AND &/.0,!4!

THE TWO OTHER MEMBERS OF ))23! S 4ECHNICAL #OORDINATION #OMMITTEE &OR INSTANCE THERE HAVE BEEN CASES IN WHICH ONE INSTITUTION PROVIDES GUARANTEES FOR PRIVATE FUNDING WHILE ANOTHER PROVIDES LOANS TO THE PUBLIC SECTOR TO COMPLETE A lNANCIAL PACKAGE !N INNOVATIVE FEATURE OF ))23! IS THAT IT ENABLES THE THREE INSTITUTIONS TO USE DIFFERENT COMBINATIONS OF lNANCIAL INSTRUMENTS AND SOURCES TO lNANCE A SINGLE PROJECT IN A COMPLEMENTARY WAY

MULTILATERAL lNANCIAL ASSISTANCE PROGRAMS 4WO OF THE -)& CLUSTERS SUPPORT ))23! FACILITATION OF INTERNATIONAL TRADE AND INVESTMENT AND PUBLIC PRIVATE PARTNERSHIPS -)& lNANCES PROJECTS THAT STRENGTHEN REGULATORY SYSTEMS TO HELP CREATE A MORE FAVORABLE ENVIRONMENT FOR PRIVATE INVESTMENT AND GIVES TIMELY SUPPORT FOR GOVERNMENT EFFORTS TO CARRY OUT CONCESSIONS OR PUBLIC PRIVATE PARTNERSHIPS &INANCING FROM THE -)& HAS HELPED GOVERNMENTS SECURE THE NECESSARY LEGAL lNANCIAL AND TECHNICAL EXPERTISE NEEDED TO PREPARE AND REVIEW BIDDING DOCUMENTS

AS WELL AS TO DRAW UP AND NEGOTIATE CONTRACTS 3EE TABLE 4HE NEW )$" )NTEGRATION &UND OFFERS GRANTS TO ACCELERATE THE DEVELOPMENT AND IMPLEMENTATION OF ))23! PROJECTS ENSURING THEIR QUALITY AND EFFECTIVENESS 4HE &UND FOR 4ECHNICAL #OOPERATION /PERATIONS FOR )NFRASTRUCTURE )NTEGRATION )NITIATIVES PROVIDES 53 MILLION IN GRANTS TO lNANCE PREFEASIBILITY AND FEASIBILITY STUDIES PROJECT DESIGN ANALYSIS OF THE TECHNICAL ECONOMIC lNANCIAL INSTITUTIONAL AND LEGAL VIABILITY OF PROJECTS AND SOCIAL AND ENVIRONMENTAL ASSESSMENTS "Y HELPING TO ENSURE A SOLID PROCESS OF PROJECT DESIGN PREPARATION AND LAND USE PLANNING THE FUND HELPS STRENGTHEN THE PLATFORM FOR SUCCESSFUL

4HE -ULTILATERAL )NVESTMENT &UND AN AUTONOMOUS FUND ADMINISTERED

BY THE )$" THAT PROMOTES PRIVATE SECTOR GROWTH IS AN IMPORTANT SOURCE OF GRANT RESOURCES TO SUPPORT ))23! 4HE -)& HAS PIONEERED THE APPLICATION OF THE CONCEPT OF PROJECT CLUSTERS IN WHICH A SERIES OF PROJECTS ARE IDENTIlED DEVELOPED AND EVALUATED AS A GROUP FOR

4HE )NTEGRATION &UND AND -)& PARTNERS TO INCREASE THE RETURN IN INFRASTRUCTURE INVESTMENT COMPLETION OF ))23! PROJECTS AND THEIR IMPLEMENTATION "Y MID

4ABLE -)& 4ECHNICAL #OOPERATION FOR ))23! 3ECTORS 4HOUSANDS OF 53

THERE WERE EIGHT PROJECTS TOTALING 53 MILLION IN THE FUND S PIPELINE 3EE TABLE

0ROJECTS 0ROGRAM FOR THE 3TRENGTHENING OF !IRPORT 3ECURITY 3OUTH !MERICAN #OUNTRIES

.ATIONAL 0ROGRAM FOR )NSTITUTIONAL $EVELOPMENT OF 0UBLIC 0RIVATE 0ARTNERSHIPS "RAZIL

-ODERNIZATION OF #USTOMS AND "ORDER #ROSSINGS 2EGIONAL

0UBLIC 0RIVATE !SSOCIATION 00! -INAS 'ERAIS "RAZIL

3TRENGTHENING %LECTRICITY 3ECTOR 2EGULATION IN 3UPPORT OF 0RIVATE )NVESTMENT 'UYANA

3UPPORT FOR THE 2EGULATORY &RAMEWORK FOR 4ELECOMMUNICATIONS 3ERVICES 5RUGUAY

0UBLIC 0RIVATE 0ARTNERSHIP 0ROGRAM IN ))23! #OLOMBIA

4/4!,

-AINSTREAMING ))23! PROJECTS IN THE "ANK PROGRAMMING HAS BECOME A REALITY IN "ECAUSE OF ITS PERMANENT DIALOGUE AND JOINT PROJECT AND PROGRAMMING EXERCISES WITH THE NATIONAL AUTHORITIES OF ITS BORROWING COUNTRY MEMBERS THE )$" IS IN A UNIQUE POSITION TO MAINSTREAM ))23! ACTIVITY IN ITS REGULAR PROCESS OF PROVIDING DEVELOPMENTAL lNANCIAL ASSISTANCE 4HIS PERMANENT DIALOGUE NORMALLY INVOLVES SETTING AN INVESTMENT AGENDA FOR THE NEXT THREE YEARS ))23!

PROJECTS ARE NOW BEING REGULARLY INCORPORATED INTO THIS DIALOGUE WHICH PAVES THE WAY NOT ONLY FOR GREATER AND MORE COORDINATED INVESTMENT OPPORTUNITIES BUT ALSO FOR THE STRENGTHENING OF INSTITUTIONS INVOLVED IN THE INITIATIVE AND THE APPLICATION OF NEW AND MORE EFFECTIVE MANAGEMENT

TOOLS ON A REGIONWIDE BASIS 4ABLE )$" )NTEGRATION &UNDn))23! /PERATIONS !PPROVED OR IN THE 0IPELINE 4HOUSANDS OF 53

)N SUM THROUGH PARTNERSHIP WITH THE )$" AND THE "ANK S REINVIGORATED PLEDGE TO FULlLL ))23! OBJECTIVES THE BENElTS OF INTEGRATION CAN BECOME A REALITY FOR ALL 4HE )$" IS STRUCTURING

0ROJECTS 0REPARATION OF -ONTEVIDEO S 0ORT -ODERNIZATION 0ROGRAM 5RUGUAY

&INAL $ESIGN AND %NVIRONMENTAL )MPACT 3TUDY

#ARANAVI "ELLAVISTA 3EGMENT OTHERS "OLIVIA

(IGHWAY !CCESS TO 0RESIDENTE &RANCOn0ORTO -EIRA "RIDGE 0ARAGUAY #ONNECTIVITY 3TUDY FREIGHT AND PASSENGER TRANSPORTATION #HILEn!RGENTINA

ITS BUSINESS STRATEGIES TO RESPOND TO THE DEMONSTRATED NEED OF ITS BORROWING MEMBER COUNTRIES FOR EXPERTISE AND lNANCIAL RESOURCES TO HELP DEVELOP COMPLEX INFRASTRUCTURE PROJECTS THAT REQUIRE TRANSNATIONAL COOPERATION CONSISTENCY WITH lSCAL REALITIES AND COUNTRY INVESTMENT PRIORITIES A DESIGN AND PLANNING PROCESS THAT MEETS THE CHALLENGES

0REINVESTMENT FOR THE 'EORGETOWNn"OA 6ISTA (IGHWAY 'UIANESE 3HIELD

OF CROSS BORDER ENTERPRISES NEW AND MODERN MANAGEMENT TOOLS AND REGULATORY HARMONIZATION 4HE )$" S PARTICIPATION IN ))23! IS AN IMPORTANT LEVER TO ACHIEVE THE "ANK S ULTIMATE GOALS OF REGIONAL

.AVIGABILITY OF THE !MAZON 7ATERWAYS 3YSTEM 0ERU

INTEGRATION POVERTY REDUCTION AND THE CREATION OF NEW OPPORTUNITIES TO

.AVIGABILITY 3TUDIES FOR THE .APO 2IVER %CUADORn0ERU

BRING THE BENElTS OF GROWTH AND JOB CREATION TO THE MAJORITIES OF THE

0REPARATION OF THE 0ROGRAM FOR THE 0ASTO -OCOA 2OAD #OLOMBIA

4/4!,

7ESTERN (EMISPHERE

4HE )$" BELIEVES THAT THE TIME IS RIPE TO EXPAND INFRASTRUCTURE IN 3OUTH !MERICA (IGH QUALITY ENVIRONMENTALLY AND SOCIALLY SUSTAINABLE INFRASTRUCTURE INVESTMENT IS A WISE WAY TO CHANNEL ADDITIONAL REVENUES ARISING FROM GREATER INTERNATIONAL DEMAND FOR 3OUTH !MERICA S GOODS )NVESTING IN THIS hEXPORTS DIVIDENDv IN STRATEGIC INFRASTRUCTURE PROJECTS WITHIN A CLEAR RATIONAL FRAMEWORKˆAS PROVIDED BY ))23!ˆAND IN THE CURRENT CONTEXT OF lSCAL DISCIPLINE CAN FURTHER REDUCE RISK PREMIUMS ON THE REGION S DEBT AND UNLOCK NEW GROWTH OPPORTUNITIES WHICH ARE FUNDAMENTAL TO ENSURE A SUSTAINABLE REDUCTION IN POVERTY AND CREATE NEW JOBS AND INCOME FOR THE MAJORITIES IN THE REGION "ETTER PLANNING AND PROJECT IMPLEMENTATION COMBINED WITH FURTHER IMPROVEMENTS IN THE REGULATORY HARMONIZATION AND STRENGTHENING OF INSTITUTIONS SERVING THE COUNTRIES WILL HELP THE REGION REAP THE BENElTS OF STRUCTURAL REFORMS AND THE MARKED IMPROVEMENT IN lSCAL CONDITIONS ACHIEVED IN THE LAST FEW YEARS

#/.#,53)/.3

))23! IS AN EFFECTIVE VEHICLE TO PLAN THE EXPANSION OF REGIONAL INFRASTRUCTURE AS WELL AS TO ADDRESS INSTITUTIONAL AND REGULATORY ISSUES ))23! HAS OPENED NEW VENUES FOR PLANNING THE EXPANSION OF INFRASTRUCTURE IN A MUCH MORE INTEGRATED AND COORDINATED FASHION

OVERCOMING MANY OF THE OBSTACLES FOR REGIONAL INTEGRATION 4HE INITIATIVE HAS EMPHASIZED EFFORTS TO DESIGN AND INTEGRATE LOGISTICAL PLATFORMS UPGRADE INFORMATION SYSTEMS AND THE REGULATIONS GOVERNING CROSS BORDER TRADE BY LAND AND SEA DEVELOP INFORMATION AND COMMUNICATION TECHNOLOGIES AND PROMOTE MULTIMODAL TRANSPORTATION 4HE EARLY INCORPORATION OF SOCIAL AND ENVIRONMENTAL CONSIDERATIONS INTO THE PROCESS AS WELL AS A COORDINATED AND TARGETED STRATEGY FOR THE PARTICIPATION OF CIVIL SOCIETY HELP EXPLAIN THE SCOPE AND SUCCESS OF THE INITIATIVE SO FAR

4HE FOCUS ON EFFECTIVE IMPLEMENTATION AND PROJECT MANAGEMENT BRINGS ADDITIONAL ASSURANCES THAT ))23! PROJECTS WILL DELIVER THEIR PROMISE 4URNING THE ))23! )NTEGRATION AND $EVELOPMENT (UBS INTO A COMPLETE REALITY OPENS NEW OPPORTUNITIES FOR REMOTE AND POOR REGIONS

CREATES NEW JOBS AND FAVORS WELFARE IMPROVEMENT TYPICALLY ASSOCIATED WITH ENHANCED TRADE AND ECONOMIC GROWTH ))23! UNDERPINS ITS CHOICE OF PROJECTS WITH SOLID ASSESSMENT OF ENVIRONMENTAL AND SOCIAL ISSUES AND COMPREHENSIVE COST BENElT ANALYSES THAT HELP MAKE THEM AND THE PLANS ASSOCIATED WITH THE HUBS BOTH SUSTAINABLE AND AFFORDABLE 4HE GROWING EMPHASIS OF ))23! ON NEW TOOLS FOR PROJECT IMPLEMENTATION AND MONITORING WILL ADDRESS BOTTLENECKS IN IMPLEMENTATION AND REDUCE DELAYS RISK AND COSTS 0ROJECTS WILL HAVE GREATER CAPACITY TO ACHIEVE THEIR INTENDED RESULTS CONTRIBUTING SIGNIlCANTLY TO DEVELOPMENT EFFECTIVENESS AND SUSTAINABLE GROWTH

4HE )$" BELIEVES THAT THE TIME IS RIPE TO EXPAND INFRASTRUCTURE IN 3OUTH !MERICA

4HE INCREASING PARTICIPATION OF THE )$" IN ))23! REmECTS A COMMITMENT TO INTEGRATION SPECIlED IN THE "ANK S FOUNDING CHARTER 2EGIONAL INTEGRATION IS A CORE MISSION OF THE )$" THAT CAN BE EFFECTIVELY ADVANCED THROUGH INTENSIlED COOPERATION WITH ))23! IN THE FRAMEWORK DESCRIBED IN THIS PUBLICATION 4HIS FRAMEWORK INCLUDES CLOSE COOPERATION WITH #!& AND &/.0,!4! THAT SO FAR HAS PROVEN TO BE AN IMPORTANT INGREDIENT OF ))23! S SUCCESS 0ROMOTING REGIONAL INTEGRATION IS A PRIORITY THAT IS ALSO PART OF AN OVERALL PROCESS OF INNOVATION SEEKING NEW WAYS TO STRUCTURE THE "ANK S OPERATIONS TO ACHIEVE GREATER EFFECTIVENESS AND MEET THE NEEDS OF BORROWERS

(/7 4/ $/ "53).%33 7)4( 4(% )$"

!NNUAL LENDING BY THE )NTER !MERICAN $EVELOPMENT "ANK HAS AVERAGED 53 BILLION IN THE PAST YEARS 4HE "ANK lNANCES PRIMARILY PUBLIC SECTOR PROJECTS AND PROGRAMS WHICH ARE IDENTIlED AND DEVELOPED DURING THE PERMANENT DIALOGUE BETWEEN THE "ANK AND THE GOVERNMENTS OF ITS BORROWING MEMBER COUNTRIES 4HE "ANK ALSO LENDS TO THE PRIVATE SECTOR AND TO SUBNATIONAL GOVERNMENTS SUCH AS MUNICIPALITIES AND PROVINCES WITHOUT GOVERNMENT GUARANTEES "ANK LOANS AND GUARANTEES IN ADDITION TO PROVIDING lNANCING ARE STRUCTURED TO ACHIEVE OVERARCHING DEVELOPMENTAL GOALS SUCH AS POVERTY REDUCTION

JOB GENERATION EXPORT PROMOTION INFRASTRUCTURE IMPROVEMENT REGIONAL INTEGRATION AND MODERNIZATION OF THE STATE !T LEAST PERCENT OF THE )$" S LENDING MUST BE BACKED BY A SOVEREIGN GOVERNMENT GUARANTEE 'ENERALLY

BUT NOT ALWAYS THE PROJECTS SUPPORTED BY THE )$" S lNANCING ALSO RECEIVE LOCAL COUNTERPART FUNDING &OR MORE INFORMATION ON )$" PROJECTS VISIT THE "ANK S 0ROJECT 'ATEWAY PORTAL AT WWW IADB ORG PROJECTS

4HE -ULTILATERAL )NVESTMENT &UND AN AUTONOMOUS FUND ADMINISTERED BY THE )$" IS ,ATIN !MERICA S LARGEST SOURCE OF TECHNICAL ASSISTANCE TO THE PRIVATE SECTOR %IGHTY PERCENT OF ITS lNANCING OPERATIONS WHICH TOTAL ABOUT 53 MILLION ANNUALLY CONSIST OF GRANTS TYPICALLY RANGING BETWEEN 53 MILLION AND 53 MILLION (UNDREDS OF -)& PARTNERS FOR INDIVIDUAL PROJECTSˆlRMS BUSINESS ASSOCIATIONS UNIVERSITIES AND NONGOVERNMENTAL ORGANIZATIONSˆ CONTRIBUTE ROUGHLY HALF THE PROJECT COST 4HE -)& HAS PARTNERED WITH OTHER lNANCIERS TO ESTABLISH VENTURE FUNDS TO DEMONSTRATE THE OPPORTUNITIES FOR RISK CAPITAL IN AREAS SUCH AS RENEWABLE ENERGY

CLEAN PRODUCTION BUSINESS CLUSTERS MICROlNANCE AND INFORMATION TECHNOLOGY 4HESE FUNDS SUPPORT lRMS WITH FEWER THAN EMPLOYEES WITH ANNUAL SALES OF A MAXIMUM OF 53 MILLION -ORE INFORMATION ON THE -)& CAN BE FOUND AT WWW IADB ORG MIF

4HE )$" S 0RIVATE 3ECTOR $EPARTMENT 02) WAS ESTABLISHED IN WITH THE PURPOSE OF SUPPORTING PHYSICAL INFRASTRUCTURE PROJECTS )TS MISSION WAS SUBSEQUENTLY EXPANDED TO PROVIDE SUPPORT FOR lNANCIAL MARKETS AND INTERNATIONAL TRADE )N THE )$" S "OARD OF 'OVERNORS REMOVED VIRTUALLY ALL RESTRICTIONS ON THE CATEGORIES OF LENDING BY THE 02) ENABLING IT TO ENTER NEW AREAS OF lNANCING SUCH AS MANUFACTURING AND MINING $IRECT )$" LOANS MAY BE UP TO A MAXIMUM OF 53 MILLION FOR A SINGLE PROJECT OR UP TO 53 MILLION IN EXCEPTIONAL CIRCUMSTANCES 4HE )$" ALSO SYNDICATES LOANS FROM COMMERCIAL BANKS FOR PRIVATE SECTOR OPERATIONS THROUGH ITS h" LOANv PROGRAM 'ENERALLY

THE 02) lNANCES UP TO PERCENT OF A PROJECT S COST -ORE INFORMATION ON 02) OPERATIONS CAN BE FOUND AT WWW IADB ORG PRI

(OW 0ROPOSALS !RE #HOSEN FOR )$" &INANCING !PPLICATIONS FOR )$" LENDING TO PUBLIC SECTOR PROJECTS ARE CONDUCTED THROUGH GOVERNMENT CHANNELS )N THESE CASES

UNLIKE LOANS MADE DIRECTLY TO THE PRIVATE SECTOR WITHOUT GOVERNMENT GUARANTEES IT IS GENERALLY NOT POSSIBLE FOR AN INDIVIDUAL OR PRIVATE lRM TO PROPOSE A PROJECT FOR )$" FUNDING )NSTEAD lRMS NEED TO IDENTIFY PROJECTS THAT ARE EITHER UNDER DEVELOPMENT OR THAT HAVE BEEN APPROVED THAT MAY NEED THEIR PRODUCTS AND SERVICES )NTERESTED PARTIES MAY REQUEST MORE INFORMATION ON DEALING WITH THE "ANK FROM THE 0UBLIC )NFORMATION #ENTER PIC IADB ORG OR FROM THE "ANK S #OUNTRY /FlCES 0ROJECTS FOR PRIVATE lRMS CONSIDERED FOR lNANCING FROM THE "ANK S 0RIVATE 3ECTOR $EPARTMENT MUST BE lNANCIALLY AND LEGALLY SOUND 4HE PROPOSED PROJECT MUST DEMONSTRATE TECHNICAL VIABILITY AND SERVE A DEVELOPMENTAL PURPOSE 4HE COMPANY MUST BE LOCATED IN AN )$" BORROWING MEMBER COUNTRY AND THE MAJORITY OF ITS CAPITAL MUST BE CONTROLLED BY INDIVIDUALS OR lRMS IN THE "ANK S MEMBER COUNTRIES )NQUIRIES REGARDING 02) OPERATIONS MAY BE ADDRESSED TO PRISECTOR IADB ORG

0ROCUREMENT /PPORTUNITIES )$" LENDING GENERATES MORE THAN CONTRACTS ANNUALLY !BOUT PERCENT OF THE ANNUAL VOLUME OF PROCUREMENT IS IN SUPPORT OF PROJECT PREPARATION WHILE THE REMAINING PERCENT FOR THE PURCHASE OF GOODS AND SERVICES IS ADMINISTERED BY THE EXECUTING AGENCIES IN BORROWING COUNTRIES /NLY BUSINESSES AND ORGANIZATIONS FROM )$" MEMBER COUNTRIES ARE ELIGIBLE TO PROVIDE GOODS AND SERVICES FOR PROJECTS )NFORMATION ON THE "ANK S PROCUREMENT POLICIES AND OPPORTUNITIES MAY BE FOUND AT WWW IADB ORG PROCUREMENT &OR INFORMATION ON THE "ANK S PROJECT PORTFOLIO¬INCLUDING lNANCIAL DATA PROJECT STATUS DESCRIPTIONS

PROCUREMENT INFORMATION CONTACT INFORMATION AND PROJECT DOCUMENTS

SEE WWW IADB ORG PROJECTS 0ROCUREMENT AND OTHER INFORMATION ON BUSINESS OPPORTUNITIES WITH THE )$" MAY BE OBTAINED FROM REGULARLY SCHEDULED BUSINESS SEMINARS HELD IN 7ASHINGTON $ # &OR A SCHEDULE OF THE SEMINARS SEE WWW IADB ORG BIZ 1UESTIONS ABOUT THE )$" S PROCUREMENT POLICIES AND OPPORTUNITIES MAY BE ADDRESSED TO BUSINESS IADB ORG

0ROPOSALS FOR lNANCING SELECTED BY THE -ULTILATERAL )NVESTMENT &UND SHOULD DEMONSTRATE INNOVATIVE APPROACHES TO PRIVATE SECTOR DEVELOPMENT THAT CAN BE USED AS A MODEL ELSEWHERE IN THE REGION #IVIL SOCIETY ORGANIZATIONS PRIVATE INDUSTRY ASSOCIATIONS AND CHAMBERS OF COMMERCE ARE AMONG THE ENTITIES THAT MAY SUBMIT PROPOSALS FOR -)& lNANCING WHICH MAY SUPPORT BOTH PUBLIC SECTOR AND PRIVATE INITIATIVES 0ROPOSALS MAY BE SUBMITTED TO THE -)& THROUGH ANY ONE OF THE )$" #OUNTRY /FlCES !PPLICATIONS SHOULD BE ROUGHLY SEVEN TO PAGES IN LENGTH EXCLUSIVE OF ANNEXES 4HE #OUNTRY /FlCES SEND THE COMPLETED APPLICATIONS TO THE CORRESPONDING OPERATIONAL DEPARTMENT AT )$" HEADQUARTERS IN 7ASHINGTON $ # WHERE THEY ARE APPRAISED 4HE LOCAL EXECUTING AGENCY FOR A -)& PROJECT IS RESPONSIBLE FOR AT LEAST PERCENT OF ITS COST HALF TO BE PAID IN CASH &OR MORE INFORMATION CONTACT MIFCONTACT IADB ORG

-!#2/%#/./-)# ).$)#!4/23 /& 3/54( !-%2)#! ).$)#!4/23 'ROWTH AND )NVESTMENTS \ 0RICES \ &ISCAL AND %XTERNAL 3ECTORS

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