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Since the early 1990s, ports in Latin America have undergone major changes in port governance and operations. Many have become privatized after being operated by their federal governments. Challenges impeding further development include funding and infrastructure improvement, especially in the highway and rail connections to and from the ports. |
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The expanding relationship with China is transforming Latin America. Major infrastructure projects, including contemplated rail, road and waterway projects, are focused on getting goods to and from Pacific ports. Growing trade with China is increasing the significance of Latin American cities on or near the Pacific Ocean, from Guayaquil to Valparaíso.
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The annual spend in the Latin American infrastructure market is US$ 60 billion and will increase by at least 20% per year over the next five years. |
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It is commonly acknowledged that the potential for growth throughout Latin America has been, and still is, inhibited by the state of infrastructure across the continent. With the public sector desperate to service this demand, the public-private finance model would seem to present the ideal solution. |
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With Chile having led the way for years in these types of financings, countries across the region are beginning to close their first deals. Brazil, Colombia, Peru and Mexico have all seen agreements clearly recognizable as PPP-type structures setup to finance major infrastructure projects. These countries lead the region with respect to the attractiveness of their private investment climate for infrastructure. |
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Infrastructure deals in communications and distribution channels such as ports, airports, pipelines and roads, remain the most attractive investment opportunity for private equity, showing a dramatic increase since 2006. |
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Chile has the most advanced transportation infrastructure of Latin America. The country invests 6% of its GDP in infrastructure, and has done so for the last 10 years. |
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Transportation infrastructure is a significant drag on the Mexican economy, and is one of the government’s key focus areas. |
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Argentina shows a lot of opportunities for companies to improve air control and air safety |
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Two huge projects in Latin America are the Trans-Andean Railroad through Chile and Argentina and the pavement of the Pan American Highway |
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