Press Releases


Jannette Esguerra
Phone: (202) 458-5204
Fax: (202) 974-4384

— Guilman-Amorim Hydroelectric Plant —

WASHINGTON, D.C., May 11, 1998—The International Finance Corporation is investing in the Guilman-Amorim Hydroelectric Power project, the first Brazilian power plant financed on a project finance basis by the private sector.

IFC’s investment in the pioneering hydroelectric plant totals US$121 million, including a loan of US$30 million for IFC’s account and US$91 million for the account of participants banks. Two large Brazilian conglomerates—Companhia Siderurgica Belgo-Mineira S.A., a steel manufacturer, and Samarco Mineracao S.A., an iron ore producer—supplied US$31 million of equity.

The 140-megawatt plant, located on the Piracicaba River in the State of Minas Gerais will provide electricity to the sponsors, freeing up the overloaded electricity distribution network in the south/southeast region and thus supplying energy to about 280,000 people.  Its annual output is expected to average about 535 gigawatt-hours.

In Brazil, estimated needs far exceed current capacity. The energy deficit in the south/southeast region is expected to reach 11 percent of demand by next year because of delays in public-sector investment in power projects. The Brazilian government in 1996 estimated that US$3.3 billion in new power-generation investments would be required annually through 2005 to avoid energy shortages, and most will have to come from the private sector.

Vivek Talvadkar, Director for IFC’s Power Department, noted that this investment would contribute to the country’s economic well being as well as help the sponsor companies be more internationally competitive.  It will also allow those companies to count on a reliable source of power in the face of increasing shortages.

The project is consistent with IFC’s strategy to support projects that can demonstrate the viability of private investments in newly opened infrastructure sectors.  IFC, part of the World Bank Group, fosters economic growth in the developing world by financing private sector investments, mobilizing capital in the international financial markets and providing technical assistance and advice to governments and businesses.