Colombia: US$150 million financial support approved for Fiducia

Colombia will receive the support of the Andean Development Corporation for an innovative operation to finance the paving of 2,500 kilometers of roads through placement of paper on capital markets.

The CAF will facilitate the operation of this mechanism by granting financial support of US$150 million to guarantee timely payment of the bonds, which will be issued by Fiducia de Mercado de Capitales and backed by future obligations of the Nation assigned to the transport sector.

CAF Executive President Enrique García said that the financial operation would facilitate a mechanism to give liquidity to the contractors of the Road Infrastructure and Regional Development Program (Plan 2.500) which the Colombian government is executing, as well as creating incentives for the Colombian capital market.

The Fiducia de Mercado de Capitales will securitize future obligations for 2.07 billion Colombian pesos (about US$800 million) assigned for execution of the Plan 2.500.

The Plan 2.500 is designed to increase the capillary action of the national road system and improve conditions of access to the territory, as well as improving the competitiveness of production and the sustainability of the national highway system.

The approved operation will provide financial support for an optimal financing mechanism designed to transfer the most competitive financial costs obtainable on the market to interested contractors when factoring their contracts.