On April 7, 2025, the Ministry of Public Works and Communications (Ministerio de Obras Públicas y Comunicaciones or “MOPC”) announced an ambitious road improvement project to connect the cities of Luque, Areguá, and San Bernardino with Route PY 02 (“Project”). With an estimated investment of USD 180 million, the Project will become the first rapid access and exit system aimed at optimizing mobility between the metropolitan area of Asunción, enhancing connectivity with the departments of Central and Cordillera.

Strategic Sections

The Project will be divided into three main sections:

• Ypacaraí – Areguá – Luque Corridor: starting at Km 41 of Route PY 02, it passes through Ypacaraí, Patiño, and Areguá, reaching downtown Luque. It includes a new bypass in Areguá to optimize traffic flow.
• Ypacaraí – San Bernardino – Luque (Tarumandy) Corridor: starting at Km 43, it connects San Bernardino with Luque. It includes lane duplication at the entrance to San Bernardino, urban improvements in the city, and lane expansions along the “Ecovía” section.
• Elevated Expressway: a 4 km elevated stretch with 2 roadways and 4 lanes, connecting Luque’s urban area to the Conmebol area. This expressway will be compatible with the future commuter train and will preserve Luque’s urban dynamic.

Contractual Framework and Financing

The Project will be carried out under the addendum to the Public-Private Partnership (PPP) contract for the construction/expansion, operation, and maintenance of Route PY 02 (the “Works”), executed between the Paraguayan State and the Rutas del Este consortium (Sacyr and Ocho A), which was awarded the Works for a 30-year term. The addendum does not extend this term, so the Project must be executed within the remaining time of the original contract. Additionally, the addendum does not imply a direct award of the Project to the Rutas del Este consortium. The MOPC will launch a public tender process to award the execution of the Project. The selected company must secure 100% of the Project’s financing. However, the addendum grants the Rutas del Este consortium the right to match the best offer submitted by any bidder. Should it choose to exercise this right, Rutas del Este will be awarded the Project.

The tender is expected to be launched at the end of July, with the contract signing scheduled for August 2025. Construction is expected to begin by the end of 2025, with a projected execution period of three years.

The Works were carried out under Law No. 5102/13 on Public-Private Partnerships (PPP), which was recently repealed by Law No. 7452/25.

Repayment Structure

The investment repayment will be structured through three mechanisms:

• Deferred Payments: semiannual payments over a 15-year period, beginning the month after 36 months from the issuance of the first notice to commence works.
• Availability Payments: quarterly payments starting from the provisional commissioning of each section and continuing until the end of the contract.
• Traffic-Linked Payments: variable payments tied to traffic volume in the covered sections, payable after the final provisional commissioning.

Impact

The project will benefit approximately 1.3 million people who travel daily through the metropolitan area of Asunción, reducing travel time by up to 30 minutes per trip in each section. This initiative marks a milestone in the modernization of Paraguay’s road infrastructure and opens new opportunities for private sector participation in PPP projects.