The works-for-taxes projects that Peru will advance this year

The Peruvian government is looking to advance with 129 projects worth a combined 8.46bn soles (US$2.24bn) through the works-for-taxes program. 

For this year, private investment promotion agency ProInversión expects to award 19 projects totaling 620mn soles, with some of the tenders slated for next month, said Denisse Miralles (pictured), the agency's director of decentralized investments, at a presentation of the plans.

Works-for-taxes has been an important mechanism to help finance small and medium-sized projects at reduced risk. In parallel to the promotion of public-private partnerships, ProInversión now plans to step up the use of the program for large projects.

BNamericas takes a look at the upcoming projects, as well as the updated portfolios of various ministries.

2023

Of this year's 19 projects, several are close to being awarded.

Southern Copper, which operates the Cuajone and Toquepala mines, is one of the companies with the strongest short-term interest in works-for-taxes.

According to ProInversión, Southern has shown interest in building high-performance schools in Apurímac region (76mn soles), in Cajamarca (79mn) and Arequipa (72mn), as well as a research center in Arequipa (40mn).

The school in Apurímac and the research center are scheduled to be awarded in May and August, respectively.

As for transportation infrastructure, the biggest project is 348mn-sol construction of the Santa Rosa bridge, which will provide an access to the new terminal of the Jorge Chávez international airport. URBI, the real estate arm of Peruvian holding Intercorp has shown interest in developing the project and awarding of the contract is slated for July. Construction works are expected to kick off in August, according to Luis Alberto Chan, executive director of national road authority Provías Nacional.

In the sanitation sector, there is a project to improve the sewage and drinking water systems in Pucusana (Lima region) that will demand an investment of 276mn soles. Arca Continental Lindley, a Peru-based Coca Cola bottler, has expressed interest in the project, which will be awarded in July.

There is also a portfolio of 29 projects worth a combined 426mn soles that are ready to start the tender process. The search for companies interested in developing them has now begun, said Miralles.

MINISTRIES

There are several ministries that are developing projects using the taxes-for-works mechanism and the transport and communications ministry (MTC) will now join this group.

In addition to the Santa Rosa bridge, MTC will develop seven projects with combined investments of 792mn soles. Of these, the paving of the access to the new Chinchero international airport (Cusco) stands out with an estimated investment of 410mn, followed by the construction of the Vía Evitamiento bypass in Ilo (Moquegua) for 150mn.

The interior ministry counts 26 projects for a total of 629mn soles, while the production ministry has 13 worth 377mn. The projects of both are in early stages of development.

The housing, construction and sanitation ministry (MVCS) has 30 sanitation projects worth a a combined 226mn soles. Of these, five are ready to start the tender process while the others need further preparation work.