Bogota, Colombia, January 27, 2016—IFC,
a member of the World Bank Group, is boosting its support of Colombia’s
infrastructure sector by financing the launch of a fund that will play
a crucial role in deploying financial resources for the country’s large-scale
IFC will invest about US$48 million in an
infrastructure debt fund that is designed to mobilize financing from pension
funds, a mostly untapped source of capital for infrastructure projects
in emerging economies. IFC’s support has been crucial for the fund, which
will be managed by Lima-based Credicorp Capital and Colombia’s Sura Asset
Management, to raise about US$400 million.
IFC worked with Credicorp Capital and Sura
Asset Management to develop the fund to help pension funds and other large
investors provide financing for infrastructure projects in Colombia. The
engagement builds on IFC’s increasing role connecting institutional investors
with opportunities to finance critically needed infrastructure projects
in emerging markets.
IFC’s global experience and successful track-record
in infrastructure finance was essential to attract investors. The fund
is designed to allow pension funds to invest in infrastructure projects
while ensuring the diversification and low volatility their portfolios
require. This type of instrument will be critical as Colombia is embarking
on an ambitious infrastructure program that will require about $24 billion
in financing to upgrade its precarious network of roadways, which requires
investments from the private sector.
“Colombia has started an ambitious road
infrastructure development plan that requires large investments. We are
firmly committed in contributing to boost financing for these large infrastructure
projects that will doubtlessly contribute to Colombia’s development and
improve its competitiveness,” said Andrés Castro, chief executive officer
at Sura Asset Management.
The Fondo de Capital Privado 4G Credicorp
Capital / SURA Asset Management fund will support the roll out of Colombia’s
Fourth Generation (4G) road program, one of the most ambitious infrastructure
packages under a public-private partnership framework in the world. The
fund is also possible thanks to new regulations approved in Colombia designed
specifically for broadening both the supply of capital for infrastructure
development as well as the demand by pension funds for local, long-term,
fixed income opportunities and diversification.
Pension funds, through these type of debt
funds, will be able to invest in infrastructure projects while ensuring
lower volatility returns and diversification benefits for the ultimate
benefit of the pensioners.
“This investment will be instrumental in
providing infrastructure finance and developing capital markets in Colombia,”
said Carlos Leiria Pinto, IFC’s head for the Andean region. “The new
fund will help address one of Colombia’s most crucial challenges and our
investment reflects IFC’s focus on unlocking more financing for urgently-needed
infrastructure upgrades in emerging markets,” he added.
The investment is the latest example of IFC’s
commitment to Colombia’s infrastructure projects. Before this, IFC helped
launch in 2014 Financiera de Desarrollo Nacional (FDN), a specialized finance
institution that is playing a critical role in securing the financial resources
needed for the country’s large-scale infrastructure projects, including
the 4G program. IFC also advised the government of Colombia in how to structure
the auctions of the 4G program.
In Colombia, IFC is engaged in supporting
sectors essential to social and economic development, such as infrastructure,
health, education, agribusiness, and public-private partnerships to build
ports, roads, and airports. IFC also promotes access to finance for micro,
small, and medium enterprises, and works on improving the investment climate
by simplifying regulations and royalty management.
IFC a member of the World Bank Group, is
the largest global development institution focused on the private sector
in emerging markets. Working with more than 2,000 businesses worldwide,
we use our capital, expertise, and influence, to create opportunity where
it’s needed most. In FY15, our long-term investments in developing countries
rose to nearly $18 billion, helping the private sector play an essential
role in the global effort to end extreme poverty and boost shared prosperity.
For more information, visit www.ifc.org