Costa Rica has more than $7 billion in unused foreign loans

March 13^th, 2013 (InsideCostaRica.com)  The Costa Rican government has $7.2 billion in foreign loans and credits for new infrastructure that remain unused, despite the fact most of the money was readily available at the time the government requested it, the Ministry of Finance acknowledged yesterday.

 

The funds were to finance roads, modernize airports, improve sewer systems, as well as education and security projects.

 

The Comptroller General’s Office questioned the lack of progress on the plans.  In fact, in the last three years, there were only three projects that required changes that would cause delays, including the award for work on the container terminal in Moin, and the decision that the metro tram should remain pending further study.

 

On Monday authorities announced the approval for the expansion of the San Jose – San Ramon highway after receiving the green light from the comptroller.

 

The two main international organizations that fund infrastructure projects in the country are the Inter-American Development Bank (IDF) and the Bank for Central American Economic Integration (BCIE).

 

Costa Rica’s execution of such projects, approved by international agencies is the lowest in Latin America, according to the Treasury.

 

Jordi Prat, the new Deputy Minister of Investment and Public Credit, said that there clearly is a problem. “The problem is that we are giving large-scale projects to institutions that have never performed a project,” Prat said.

 

On average, infrastructure projects take three to five years to complete.  However, in Costa Rica there are initiatives that exceed that period.  The oldest case is that of the San Jose sanitary sewer project, which was backed by the Japanese Bank for International Cooperation (JBIC) in 2007.  “The biggest delay was in the award [for the construction] of the sewage plant, because competing companies appealed the award of the work,” said Eduardo Lezama, assistant manager of AyA.

 

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