IDB Transport Sector (INE/TSP) Sector Overview, Strategy and Portfolio INTER-AMERICAN DEVELOPMENT BANK

Outline of Presentation  Infrastructure and Transport Investment in the Region  IDB Participation in overall Infrastructure and Transport Lending in the Region  Trends in IDB Transport Lending  IDB Strategy for the Transport Sector  Transport Projects in the Region

Total Investment in Infrastructure (as a % of GDP) Total investment in infrastructure within the Region has seen a strong decline in the last two decades: from an average of 3.7% of GDP in the period to an average of 2.2% of GDP in the period.

Total Public and Private Investment in Infrastructure (as a % of GDP) This decline in overall infrastructure investment has been caused by a generalized retreat of public investment and the incapacity of the private sector to compensate the public sector retreat. PUBLIC PRIVATE

Total Investment in land-based Transportation* (as a % of GDP) TOTALPUBLICPRIVATE * Includes road and rail based transportation The decline in infrastructure investment has not affected all sectors equally: the transport sector has been severely impacted.

Total Investment in land-based Transportation by Country (as a % of GDP) With the exception of Chile, all countries have seen a strong decline in overall investments dedicated to land-based transport.

Total Public Investment in land-based Transportation by Country (as a % of GDP) This decline has been triggered by a generalized shortcut in public investment within the transport sector.

IDB Transport Lending Relevance of transport sector within Bank portfolio, although participation is declining (overall participation reached low-point of 8%) Transport lending since 1961: US$ million; 11% of total Bank lending; and 35% of infrastructure lending

IDB Transport Lending Large drop in lending during 90’s Assumption of large private sector participation Fiscal constraints in borrowing countries Similar situation in other MDBs * IDB Private Sector: since 1995, 10.4% of lending in transport, 23% of the PRI portfolio

IDB Transport Lending

Transport lending by mode and MDB: concentration of financing on road sector (76% of total). This concentration is even greater for the IDB, with road sector projects accounting for 87% of total financing.

IDB Transport Lending IDB Transport Portfolio Total Transport Lending, by mode and MDB Concentration of projects in the road sector, with a recent niche in urban transport projects (bus-based) Although the WB and the IDB account for over 80% of total lending in the sector, the CAF is gaining increased relevance

IDB Transport Lending Brazil: main client in the transport portfolio (28%) Dominance of CAF in Bolivia, Colombia, Ecuador and Venezuela

Trends in IDB Transport Lending Objective: intensify IDB’s participation within the Transport sector Bank’s intention is to lend US$12 billion for infrastructure during the next five years Infrastructure Project Preparation Fund (Infrafund): will support scaling up of infrastructure investments Goal: lend US$12 billion for infrastructure in LAC during the next five years

Trends in IDB Transport Lending ROAD REHABILITATION & MAINTENANCE DESCENTRALIZATION URBAN TRANSPORT & COMPETITIVENESS Performance-based maintenance contracts (CREMA-type and micro enterprises) and Road Maintenance Funds SWAPs and PDLs (IDB new lending framework) Loans with sub-national governments Loans without sovereign guarantee Local currency Urban Transport Projects (BRT systems) Freight Transport Urban Logistics TERRITORIAL INTEGRATION & SOCIAL INCLUSION Improve accessibility and reduce transport costs of goods and passengers Rural and secondary roads

Trends in IDB Transport Lending PRIVATE PARTICIPATION REGIONAL INTEGRATION PPPs PRI IIRSA/PPP FIRII Fund-TCs AIRPORT & PORT SECURITY TCs INSTITUTIONAL STRENGTHENING Develop institutional and financial capacity of government agencies in charge of transport policy and programs

New Project Cycle

Detailed Project Cycle

Transport Projects-Pipeline 2008 (A)

Transport Projects-Pipeline 2008 (B) Total Pipeline 2008 (A+B)=US$3,586,400.00

Transport Projects-Pipeline 2009 (A)

Presented by Rafael Acevedo INE/TSP Thank you!