Page 137 - STRATEGY Magazine (G)

A US $300 million expansion of the container terminal at the Quetzal port on the Pacific and the renovation and expansion of the Barrios port on the Caribbean
Transportation investment projects costing US $1.82 billion to connect the borders of Mexico and El Salvador and an east-west corridor that will connect the ports and include bypasses to Guatemala City
Creation of freight and passenger rail connectors bud- geted for US $670 million.The proposed freight project will connect Ciudad Hidalgo in Mexico to the industrial city of Escuintla in the country’s south and to the Pacific ports.
The passenger rail will connect the northern and southernzones of the capital
Power generation projects totaling an investment of US $5.82 billion to diversify the country’s energy sources and expand coverage through power transmission projects
Another US $700 million will be needed for the construc- tion of natural gas pipelines, a power plant, and the conversion of plants to gas. The pipeline will connect to Mexico’s network
Many of the proposed projects will directly benefit shipping and the country’s ports. The country had US $23.4 billion in foreign trade in 2014. The majority of the imports and exports, 77 percent, were carried by sea, while 22 percent went by road and 1 percent by air.
MUCH TO OFFER
Guatemala is not starting from scratch as it embarks on its next phase of infrastructure projects. The country currently has:
43,446 miles of paved road, which connect the country’s different regions, ports, and the country’s borders with Cen- tral America and Mexico
Three ports on the Pacific coast and two on the Caribbe- an. The Port of San José, on the Pacific, is designed for the export and import of petroleum, and the neighboring Port
of Quetzal handles both container and cruise ships. Santo Tomás de Castilla, on the Caribbean, is the busiest container port, handling more than 3 million metric tons annually of containerized cargo
Seven regional airports that complement the country’s La Aurora International Airport in Guatemala City
CRISTIÁN NOVALES
Partner
Novales Abogados
Cristián Novales Schlesinger, a partner at Novales Abogados, foresees Guatemala as a logis- tical hub for Central America in the near future. The nation’s strategic location and the govern- ment’s willingness to adopt pub- lic-private partnerships (PPPs) mean that investors—especially those engaged in capital market offerings—will have consider- able opportunity to modernize
through capital market offerings, as a “strategic means of ob- taining public support for the project and obtaining access to di- versified sources of financing.” While past projects have included developing modern highways and power generation, Novales predicts that new projects will involve constructing an oil and gas pipeline from Mexico. Since the second Business Summit of the Americas, Novales notes that all Central American nations, including Guatemala, are taking significant steps to transform the region into a logistical focal point for North and South Amer- ica.
“PPPs are the model of choice for up- grading and modernizing Guatemala’s infrastructure. They will allow access to private sector innovation, efficiency, and technology without the need for signifi- cant outlays of public funds.”
Public-Private Collaborations Are Key to Guatemala’s Future
infrastructure. According to Novales, “the decentralized entity ANADIE, the National Agency of Alliances for Development of Economic Infrastructure, is charged with promoting private in- vestment in infrastructure projects and programs and manag- ing the development, construction, and implementation of new infrastructure projects.” ANADIE’s current projects include de- veloping a dry port on the Guatemalan-Mexican border and the construction of rail transportation systems.
SECURING SUCCESS
Novales believes that one of the best ways of securing the suc- cess of major new infrastructure projects is by seeking financing
SPECIAL REPORT
strategybg.com 135