Peru seeks to award US$2bn in PPPs in H2

Peru's investment promotion agency ProInversión plans to award PPP contracts for an additional US$2bn, after it awarded six contracts for US$1.04bn in H1.

Tenders will be launched for the rehabilitation of the Huancayo-Huancaveilica rail, which crosses Junín and Huancavelica, an industrial park in Lima's Ancón district and several transmission lines, ProInversión head Luis Natal del Carpio Castro (pictured) told BNamericas.

Capex for the rail increased from US$100mn to US$248mn, as ProInversión is also working on three port projects, Del Carpio said. A tender for one will be launched this year, while the other two are in the pre-investment stage.

Panel during PPP Americas 2023

During a panel at the the Inter-American Development Bank's (IDB) PPP Americas 2023 event in Panama City, Del Carpio said Peru signed 113 PPP contracts in the last 21 years, demonstrating the success of the modality. He also said the trust the government and society put in the private sector to build and operate infrastructure enabled development of more projects, especially in the social sector.

Del Carpio talked to BNamericas on the sidelines of the event.

Portfolio

BNamericas: Can you provide an update on the Huancayo-Huancavelica rail?

Del Carpio: We were reviewing and the latest capex increase is correct: 50% more. We are talking about over US$100mn more than earmarked in the previous contest. We hope to award it in December. Bidders are currently being qualified to be eligible to submit offers. Next, we will publish the official contract version. We are confident that investors will agree with it and will present their proposals in December.

BNamericas: What are the two port projects you mentioned at the event?

Del Carpio: We have the San Juan de Marcona terminal, specialized in minerals, which we are going to declare of interest in August or September, and will probably award by the end of the year. Being a private initiative, if interested third parties show up, there will be a contest. If there are no interested parties, we estimate that it could be awarded in December. It is an investment of just over US$400mn, which would be the ninth port terminal that we have worked on at ProInversión.

The other is a multipurpose port terminal in Chimbote (Ancash region), involving US$170-180mn. The focus will be to move agricultural export cargo, mining cargo, different types of bulk and liquids. We plan to declare it of interest in February or March next year. We could also award it next year.

We are also working on and seeking investors for the Lambayeque port terminal in the north.

Chimbote and Marcona are private projects, so we already have investors.

BNamericas: What other highlights are in your portfolio? What should the government do to unlock more investment?

Del Carpio: The word trust is something we started with at Proinversión this year. We have awarded six projects for US$1bn between January and June and our July-December portfolio has a commitment to award an additional US$2bn.

For next year, we have the commitment to award US$6bn or a little more. [During that period] we will have many water treatment plants, schools and the 34km Anillo Vial Periférico highway that we hope to declare of interest in September this year. If there are no interested parties, the process would be moved to the following year. The highway in Lima represents an investment of US$2.3bn.

BNamericas: How will the portfolio develop?

Del Carpio: With more social projects. I believe that we must close the infrastructure gap quickly due to the issues of education and health. We believe that the population has understood that the private management of hospitals and schools is not privatization; it is simply to establish a contract so that the service is provided in the long term in an efficient manner.

Luis Alonso Altamirano contributed reporting.