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Storm into ports
06 February 2012
Compelling economics have made ports deals a favourite for lenders in Latin America. Sponsors will have more options in replacing European lenders than many, but will still have to cast a wide net. By John Rumsey.
Latin port projects have proven popular despite choppy financing markets. They make long-term sense, as the region faces massive logistical bottlenecks, governments have embraced port privatisation and natural resources producers are scrambling to build their own outlets. Ports are rich sources of dollar revenues, which are conducive to multilateral US dollar funding and international commercial bank participation, says Gabriel Goldschmidt, senior manager for Latin America infrastructure at the International Finance Corporation (IFC). The IFC has financed more than 20 seaport projects in the region.
Continued trade between Asia and Latin America has supported increasing investment in the port sector in the region, and proven the economic viability of port projects, and so the sector has done remarkably well to date, says Fuensanta Diaz Cobacho, managing director and head of infrastructure Americas at WestLB. The large financing for Brazil’s Empresa Brasileira de Terminais Portuarios (Embraport) closed in November in spite of turmoil...
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