Colombia s construction industry is on pace to reach our forecasted growth rate of -.- this year, with -.- recorded for Q- ----. We expect it to continue to post one of the highest growth rates in the region, with the sector to average -.- annually over the next five years (---------). ...We expect it to continue to post one of the highest growth rates in the region, with the sector to average -.- annually over the next five years (---------). The country s successful implementation of the public-private partnership (PPP) model will be the major driver in future construction growth, with the vast majority of high-value projects utilizing the model. The USD--bn -G Highway Concession Program represents the largest benefactor from the increased use of innovative financing and PPPs. ...This will be critical for maintaining the flow of funding given that the Colombian economy is facing numerous challenges - namely the low oil price environment, a weak peso and the ongoing peace process. A final ceasefire between the State of Colombia and the FARC creates upside potential for our forecasts as the government moves to reincorporate territory through infrastructure development programs.
...Over the next five years the impetus for construction industry expansion will come from the continued successful use of the PPP model, which has gained enormous traction since the implementation of major reforms over the course of ---- to ----. Two major pieces of legislation have enabled the success seen with the model: the ---- PPP Law and the ---- Colombia Transportation Infrastructure Law. The PPP law, similar to Mexico s, addresses major financing and contracting issues, shows clear political support for the model, and applies to both the national and sub-national government. Additionally, the creation of the National Infrastructure Agency (NIA) in ---- under the charge of former McKinsey And Co Colombia head Luis Fernando Andrade Moreno, has been critical for developing the nationwide plan for the use of PPPs and structuring the concession under the -G highway program. With PPP projects dominating the tendering and financing phases of the Colombian infrastructure project pipeline, we expect works funded via the model to surpass public funding and become the largest contributor to infrastructure construction growth. ...With PPP projects dominating the tendering and financing phases of the Colombian infrastructure project pipeline, we expect works funded via the model to surpass public funding and become the largest contributor to infrastructure construction growth.
...Institutional Reforms have also helped to speed up the process by addressing major roadblocks which have previously held up construction, as well as providing for the improved institutional capacity required to successfully plan and tender major projects. According to the National Planning Department of Colombia, at the time of the passage of the Transportation Infrastructure Law (March ----), approximately -- of the -- transportation infrastructure projects underway in the country reported problems with environmental licenses, -- with indigenous community consultation, and -- with the owners of real estate. ...
