New Paraguay govt to review PPP framework

Paraguay's upcoming government, which will take office on August 15, will review the frameworks for public-private partnerships (PPP) and turnkey contracts, following some failed tenders for major projects that took place during the current administration.

Former finance vice-minister Daniel Correa, now part of president-elect Mario Abdo's economic team, told daily Última Hora that the infrastructure projects that were tendered under the old framework didn't have the desired impact on the local economy, mainly because of issues with transparency, bureaucracy and the speed of the processes.

"Today, after five years (after the current framework was enacted), we're in conditions to see which are the lessons learned, but these instruments clearly could have had a bigger impact on investment," he said.

Correa clarified that Abdo's administration won't discard neither of the two models, as the president-elect aims to use all tools available to increase investment.

Some of the projects that the current government failed to get going through the PPP or turnkey contracts include:

Transchaco route rehabilitation: The US$450mn turnkey contract was discarded in 2016 following concerns of the finance ministry over the cost. A new tender for a US$560mn contract will be issued next year.

Silvio Pettirossi airport expansion: The tender for the US$149mn contract to expand and operate the country's main airport was launched as a PPP in 2015, but in 2017 the country's comptroller recommended voiding the process, arguing that the public works ministry (MOPC) had skipped the pre-qualification phase and favored an offer by Sacyr and Agunsa. The ministry appealed the decision before the supreme court, which hasn't issued a decision yet.