The Government has created a Trust and a program to protect the PPP public works financing
As a result of the uncertainty created by the corruption investigation in public works, a trust will be put in place that will ensure its financing and unlock the short-term loans that were negotiated in the PPP (Public-Private Partnership) bids. The trust will allow the contributions of the banks to finance the works, go through this state trust to the companies.
This trust will be a tool to give financial liquidity to public works, will be managed by the Minister of Transportation, and Banco Nación will provide a capital of 200 million dollars for companies that have the concession of the six road corridors already tendered and another 30 billion pesos to discount the work certificates. The contribution that Banco Nación will make to the operation of this trust, will be accompanied by other private banks.
Up to now, the PPP has granted six road corridors, with an investment of U.S. $6 billion. Among the companies involved that won the award of PPP works are José Cartellone Construcciones Civiles, Helport (whose majority shareholder is Eduardo Eurnekian), and Vial Agro, by businessman Pablo Quantín.
The Minister of Transportation confirmed that for the time being the companies that are being investigated in the case for alleged bribes in public works will continue to lead the works that have been awarded and that until there is a judicial definition may continue to be admitted to submit bids.
This is how the Government trust will work:
- This trust acts as an intermediary between the financial sector and the construction companies to ensure the start of work on 6 road corridors, which is scheduled to start in late October and early November. The new financing trust was created within the framework of Law 27,328 of Public Private Participation.
- The trust will allow a loan equivalent to the necessary flow for the works of the first year of 1,2 billion dollars. The National Bank will initially provide between 200 and 300 million dollars to this trust, which will then be added by other entities.
- For public works that continue to be developed outside the PPP scheme, there will be changes in the works certificates in order to facilitate access to the contractors' loans. Banco Nación will also contribute a sum of around 30 billion pesos for this type of operation.
- The Government announced that a new ethical and integrity framework will be implemented for the contracting of public works, requiring companies to submit new requirements of integrity to participate in the trust, prepared by the competent control bodies (General Office of the National Union (SIGEN ), Anticorruption Office (OA), National Securities Commission (CNV), National Commission for the Defense of Competition (CNDC) and Financial Information Unit (UIF).
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