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Colombia to increase private investment in infrastructure with IDB support

A$25 million loan support mechanisms and projects in various economic and social sectors in the country

The Inter-American Development Bank (IDB) approved a $25 million loan in Colombia that will support private investment in infrastructure, strengthening technical and regulatory mechanisms that promote financing, supply, operation and maintenance of infrastructure in various economic and social areas. 

Although annual investment in infrastructure in Colombia over the past decade has kept up sustained growth, it still remains below 4 percent of GDP. It is estimated that the proportion should rise to between 8 and 10 percent of national output in order to reach adequate levels. 

The hope is that as a result of this program, up to $15 billion in projects and investment in infrastructure can be freed up over the next 10 years. This would contribute to an accumulated increase in private investment equivalent to 4.2 percent of Colombia’s GDP through 2024. 

The BID project will finance the carrying out of studies for formulating policy, institutional, legal and regulatory frameworks in different areas of infrastructure, both at the national and sub-national levels, as well as the identification, preparation and implementation of projects with potential for private investment. Furthermore, the National Planning Department will be strengthened for the management of projects and development of efficient plans for private participation and compliance with regulatory requirements in projects involving public-private partnerships. 

The $25 million IDB loan will have a bullet repayment in 2029, a grace period of 15.25 years and an interest rate based on the LIBOR.

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