{"id":4736,"date":"2024-01-22T18:32:50","date_gmt":"2024-01-22T22:32:50","guid":{"rendered":"https:\/\/www.vouga.com.py\/?p=4736"},"modified":"2024-01-23T15:29:33","modified_gmt":"2024-01-23T19:29:33","slug":"novedades-en-infraestructura-y-proyectos-enero-2024","status":"publish","type":"post","link":"https:\/\/www.vouga.com.py\/en\/novedades-en-infraestructura-y-proyectos-enero-2024\/","title":{"rendered":"Infrastructure and Projects News - January 2024"},"content":{"rendered":"

Executive Summary<\/strong><\/p>\n\n\n\n

Regulation<\/strong><\/td>Content<\/strong><\/td>Date<\/strong><\/td><\/tr>
Law<\/td>Enactment of Law 7237\/2023 \"Establishing special provisions and financing for the execution and implementation of the suburban train between the city of Asunci\u00f3n and Ypacara\u00ed, under the responsibility of the Ministry of Public Works and the Paraguayan Railways Company S.A.; and authorizing the respective subcontracting agreement.\"<\/td>December 26, 2023<\/td><\/tr>
Call for Bids<\/td>The National Directorate of Public Procurement (\u201cDNCP\u201d) has published on its portal the invitation to an International Public Tender (\u201cIPT\u201d) for the National Route No. 17 Improvement Project, connecting Pedro Juan Caballero \u2013 Capit\u00e1n Bado \u2013 Itanar\u00e1 \u2013 Ypejh\u00fa in the Departments of Amambay and Canindey\u00fa.<\/td>January 5, 2024<\/td><\/tr>
General<\/td>The Ministry of Public Works and Communications (\u201cMOPC\u201d) issued Resolution No. 2218 announcing the five prequalified consortia that will continue participating in the bidding process 1288 \"Call DIPE 01\/2023 Prequalification Public Investment Project for the Expansion and Improvement of Route PY01, in the section between Cuatro Mojones and Quiindy.\"<\/td>December 29, 2023<\/td><\/tr>
Law<\/td>Update on the status of the water and sanitation project for the Metropolitan Area of Ciudad del Este, financed by the Inter-American Development Bank (\u201cIDB\u201d) and the Japan International Cooperation Agency (\u201cJICA\u201d) for a total of USD 200,000,000.<\/td>May 11, 2023<\/td><\/tr>
Law<\/td>Update on the water and sanitation project for the Metropolitan Area of Asunci\u00f3n \u2013 Lambar\u00e9 Basin, financed by the Inter-American Development Bank (\u201cIDB\u201d) and the Official Credit Institute of the Kingdom of Spain (\u201cICO\u201d) for a total of USD 165,000,000.<\/td>April 24, 2023<\/td><\/tr>
Law<\/td>Enactment of Law 7182\/2023 approving the loan agreement between the Republic of Paraguay and the Andean Development Corporation (\u201cCAF\u201d) for an amount of USD 160,000,000 for the financing of the water and sanitation project for the Metropolitan Area of Mariano Roque Alonso.<\/td>October 18, 2023<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

More Information:<\/strong><\/p>\n\n\n\n

\u25ba The Executive Branch enacted Law 7237\/2023, which establishes the financing conditions for the execution and implementation of the \"Suburban Train\" Project.<\/strong><\/p>\n\n\n\n

General Aspects<\/strong><\/p>\n\n\n\n

On December 26, 2023, the Executive Branch enacted Law 7237\/2023 (the \"Law\"), which provides special provisions and financing for the execution and implementation of the suburban train project, powered by renewable energy. The route will stretch between the cities of Asunci\u00f3n and Ypacara\u00ed (the \"Project\").<\/p>\n\n\n\n

The MOPC and the Paraguayan Railways Company S.A. (\u201cFEPASA\u201d) will be responsible for executing the Project.<\/p>\n\n\n\n

Project Financing<\/strong><\/h1>\n\n\n\n

The Law authorizes the Ministry of Economy and Finance (\u201cMEF\u201d) to undertake the necessary steps for Project financing. In this regard, the Law specifies that, for the credit instrument to be valid, it must receive approval from Congress. Furthermore, the MEF will assume financial commitments only after the approval of the loan agreement, which must adhere to the terms of the Law.<\/p>\n\n\n\n

Establishment of Guarantee and Liquidity Trust<\/strong><\/h1>\n\n\n\n

The Law anticipates the creation of a guarantee and liquidity trust, where the MEF will be the settlor, and the Financial Development Agency (\u201cAFD\u201d) will act as the trustee.<\/p>\n\n\n\n

The purpose of the trust is to manage all resources generated by the Project, including those used to finance availability payments outlined in the Law. Payments will be unconditional and irrevocable. The Executive Branch will regulate the guidelines and regulatory mechanisms of the trust and availability payments; as of now, this regulation has not been promulgated.<\/p>\n\n\n\n

Implementation Agreement<\/strong><\/h1>\n\n\n\n

It is important to note that the Project is structured as a government-to-government agreement between the Republic of Paraguay and the Republic of Korea (South). The Law empowers the MOPC to sign an implementation agreement with the Korean Public Organization, Korea Overseas Infrastructure & Urban Development Corporation (KIND)[1]<\/a>, outlining the commitments of the parties within the Project framework.<\/p>\n\n\n\n

While the Project will be governed by the Law and not by Law No. 5102\/2013 \"PROMOTION OF INVESTMENT IN PUBLIC INFRASTRUCTURE AND EXPANSION AND IMPROVEMENT OF GOODS AND SERVICES PROVIDED BY THE STATE\" (the \u201cPPP Law\u201d), the final structure of the Law, once regulated, is likely to be similar to that of the PPP Law.<\/p>\n\n\n\n

It is noteworthy that Article 11 of the Law states that, within the Project's development, KIND may avail itself of the benefits of Law No. 60\/1990 \"APPROVING, WITH AMENDMENTS, DECREE-LAW NO. 27, DATED MARCH 31, 1990, 'AMENDING AND EXPANDING DECREE-LAW NO. 19, DATED APRIL 28, 1989,' 'ESTABLISHING THE FISCAL INCENTIVE REGIME FOR INVESTMENTS OF NATIONAL AND FOREIGN ORIGIN CAPITAL.'\"<\/p>\n\n\n\n

Project Payment Mechanisms<\/strong><\/h1>\n\n\n\n

The MEF will provide the concessionaire or sub-concessionaire with availability payments in U.S. dollars through the trust (\"Payments\"). However, Payments will be made only once the quality, service, and performance indicators set by the MOPC and FEPASA are met. They are the ones authorized to instruct payment to the MEF when applicable.<\/p>\n\n\n\n

Payments will become unconditional and irrevocable once the compliance with quality and service indicators is approved.<\/p>\n\n\n\n

Land Release for Project Execution<\/strong><\/h1>\n\n\n\n

The MOPC and FEPASA will be responsible for: (i) land release, (ii) land acquisition, (iii) relocation, (iv) compensation, (v) cleaning of the areas involved in the Project execution, and even (vi) release of necessary dominion strips under the expropriation regime provided for in Law No. 6084\/2018.<\/p>\n\n\n\n

This is likely to be one of the most challenging aspects of Project realization since successful negotiation with neighbors whose properties currently occupy the dominion strip and oppose the Project with the current layout will be necessary.<\/p>\n\n\n\n

Project Value, Timelines, and Scope<\/strong><\/p>\n\n\n\n

The Project is valued at approximately USD 550,000,000, and its construction is estimated to take around 4 years, with a sub-concession period of 30 years. In this regard, Article 5 of the Law establishes that the sub-concession contract will be granted to KIND by the Executive Branch through FEPASA (the \"Contract\"). Likewise, once the Contract is signed, KIND will be obligated to secure financial closure to finance the Project, in accordance with the terms established in the Contract and regulations.  <\/p>\n\n\n\n

The Project will cover a distance of 43 kilometers, connecting Asunci\u00f3n with the towns of Luque, Yukyry, Aregu\u00e1, Pati\u00f1o, and Ypacara\u00ed. The route traverses one of the country's most densely populated areas; therefore, it is expected that the Project's realization and operation will significantly reduce inbound and outbound traffic to the capital, in addition to considerably improving public transportation conditions for citizens.<\/p>\n\n\n\n

\u25ba International Public Tender call for surveying, compensation, expansion, and improvement of Route PY 17 \u201cRoute of Sovereignty\u201d<\/strong><\/p>\n\n\n\n

General Aspects<\/strong><\/h1>\n\n\n\n

On January 5, 2024, the National Directorate of Public Procurement (DNCP) published on its portal the call for Tender 438107<\/a> convened under the IPT procedure for the survey, compensation, construction, and maintenance of the pavement of Route PY 17. This route connects the towns of Pedro Juan Caballero \u2013 Zanja Pyta \u2013 Capit\u00e1n Bado \u2013 Itanar\u00e1 \u2013 Ypejh\u00fa, in the departments of Amambay and Canindey\u00fa (the \"Project\").<\/p>\n\n\n\n

The Project aims to improve the connection between two of the country's most important productive areas. It is estimated that it will benefit approximately 150,000 people.<\/p>\n\n\n\n

The execution of the Project includes, among others, works such as: earthworks, drainage; construction of the structural package, main axis, and accesses; paving; complementary works such as construction and removal of fences, signage, lighting, weighing and toll booths, counting booths, and environmental management plan.<\/p>\n\n\n\n

Investment Amount<\/strong><\/p>\n\n\n\n

\u20b21,432,191,265,000 (Approximately USD 215,000,000). The Project will be financed with a loan from the Financial Fund for the Development of the La Plata Basin (\u201cFONPLATA\u201d).<\/p>\n\n\n\n

Bid Maintenance Guarantee<\/strong><\/p>\n\n\n\n

3% - insurance or bank guarantee.<\/p>\n\n\n\n

Deadline for Submission of Bids<\/strong><\/p>\n\n\n\n

Friday, January 26, 2024. (9:00 a.m.)<\/p>\n\n\n\n

Awarding System<\/strong><\/p>\n\n\n\n

Per lot. The Project is divided into 4 lots. The adjudication of more than one lot to an offeror is allowed. Below is the planned length for each lot.<\/p>\n\n\n\n