InterAmerican Development Bank

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Inter-American Development Bank
Initiative for the Integration of Infrastructure
in South America (IIRSA)
Drs. Bertus J. Meins Chief, Cofinancing
Division Washington, D.C.
Amsterdam, CEDLA, May 3, 2005
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Inter-American Development Bank
Initiative for the Integration of Infrastructure
in South America (IIRSA)
Drs. Bertus J. Meins Chief, Cofinancing
Division Washington, D.C.
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LAC Insufficient LT Growth
LAC needs to grow gt6 to reduce poverty
(Population growth 1.8 p.a.)
Yet Real growth 1996-2000 3.1 2001-2004
2.3 2004 5.5 2005
(forecast) 4.0 4.5
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Current Economic Trends in LAC

• Export-led recovery
• Commodity boom
• Fiscal monetary prudence
• Reserve accumulation
• YET
• Persistent low S I ratios
• High public debt exposure
• Low public investment
• Poor infrastructure
• Stagnating competitiveness
• Dependency on commodity exports

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To improve, LAC needs

• Prudent macro policies
• Higher S I ratios
• Higher public revenue/lower costs
• Reform of the State
• Replace public with private financing
• Concessions for infrastructure
• Embrace FDI
• Regional/global integration

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Special Case Transportation LAC

• Outdated infrastructure obstacle to exports
• Bottlenecks evident in
• Roads
• Railways
• Rivers
• Bridges
• Ports/Terminals
• Container vessels
• Airports (procedures)
• Energy generation transmission
• Panama Canal - draft (capacity)
• - pricing (115 to 165 per container)

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IIRSA Initiative for Regional Infrastructure
Integration in South America

• Inception Brasilia, 2000 (Summit SA Presidents)
• Guayaquil, 2002 (Planning process)
• Cuzco, 2004 (Implementation process
  2005-10)
• Goal Modernize integrate regional
  infrastructure
• Support IDB, CAF, FONPLATA (INTAL)
• Infrastructure Platform - Transportation
• - Energy
• - Telecommunications
• Complementary Approaches
• Integration development hubs
• Sector integration processes

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IIRSA Sector Integration Process

• Identify regulatory, operating and
  institutional bottlenecks
• Action sector processes in
• Information communication
  technologies
• Air transport systems
• Multimodal transport systems
• Maritime transport systems
• Border crossing procedures
• Regulatory frameworks (energy)
• Financing instruments

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IIRSA Completed Studies Diagnostics

• Assessment of seven sector processes
• Strategic vision LA 2020
• Business vision integration development
  hubs (analysis territory, economic activities,
  social and environmental considerations,
  facilitated by use of spatial planning tools)
• Results
• gt 300 integration projects
• 40 groups with anchor projects
• Identification of first 31 projects 2005-2010

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AGENDA FOR IMPLEMENTATION 2005-2010 (31 Projects)
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Typical IIRSA projects (1) / Mercosur Chile Hub
Puerto Pte. Franco-Porto Meira Bi-national Bridge
Project
PARAGUAY - BRAZIL
Basic project information

• Bridge length about 800 meters.

• Access roads about 10 Km in each side.

• Total Project Cost about US 100 million
  (including access roads, border center and other
  facilities).

() Data based on available preliminar
information.
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Typical IIRSA projects (2) / Capricorn Hub
Central Trans-Andean Railway Project
CHILE - ARGENTINA
Project basic information

• Built in 1912 operation suspended in 1984.

Tunnel portion Juncal - Chile

• 250 Km railroad rehabilitation (180 Km
  railroad on Argentina side, and 70 Km on Chile
  side).

Railroad portion Portillo Juncal - Chile

• Total Project Cost about US 260 million.

• Bidding process under preparation.

() Data based on available preliminar
information.
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IIRSA NEXT STEPS

• Innovative public-private financing
  modalities
• Overcoming constraints financing public
  projects
• Consensus building
• More active civil society involvement
• Framework agreement LAIA (Latin American
  Integration Association)
• Dissemination of environmental social
  standards for integration projects

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IIRSA IDB INVOLVEMENT
Value Added

• Multinational leverage
• Vision Integrated and holistic
• Technical analysis standards
• Environmental social issues
• Participation civil society
• Project cross-fertilization

• Resource mobilization capacity
• Special funds for project preparation
• Cofinancing of IIRSA projects

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IIRSA IDB ACTIVITIES

• Technical assistance cooperation
• Studies assessments
• Organization of IIRSA activities
• Technical cooperation funds

• Information to Private Sector
• Assist in attracting private sector interest
• Financing guarantees
• Facility for transnational infrastructure
  preparation
• Public-private financing
• Political risk guarantee
• Cofinancing

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IIRSA Business Opportunities

• Feasibility studies
• Social assessments
• Environmental impact studies
• Engineering studies
• Design
• Construction
• Operation
• Concessions
• Financing
• Financial engineering
• Technical advice
• (More info. Website www.iirsa.org)

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For more information
Bertus J. Meins Chief, Cofinancing
Division Inter-American Development
Bank Washington, D.C. Tel. [phone] Fax.
202-623-2543 E-mail bertusm_at_iadb.org