Peru Flooding Spurs Infrastructure Investments
Peru was recently pummeled by heavy rains, flooding and disastrous landslides, which destroyed buildings, bridges and roads. In Peru’s bustling capital Lima, heavy flooding clogged a water treatment plant, forcing a shut-down restricting the availability of running water and prompting water rationing across many regions of the city.
Natural disasters are nothing new in Peru, and repeat events — driven in part by the El Nino phenomenon — are a certainty. Infrastructure investment has been a longtime theme of President Pedro Pablo Kuczynski’s political platform, and recent events underscored the immediate need to make such investments a top priority. Peru’s government already announced a $240 million investment in the badly-affected infrastructure of the country’s northern coast. In addition, some Peruvian politicians are even calling for the cancellation of the 2019 Pan American Games in order to shift available funds towards rebuilding. The pressure for immediate and sweeping investment in the country’s infrastructure is rising.
Peru has long encouraged private investment in its infrastructure through Public-Private Partnership (“PPP”) projects, managed by the government’s Private Investment Promotion Agency “Proinversion” (http://www.proinversion.gob.pe). Even before the recent floods, President Kuczynski and his administration have aimed to overhaul Proinversion in order to streamline and step up private sector investment and, between March 8 and March 13, 2017, Proinversion’s Executive Director Álvaro Quijandría traveled to New York, Washington and Miami to promote international investment in Peru. Recent events stress the need to revamp Peru’s vulnerable infrastructure. At the same time, the Kuczynski administration has been signaling a stern eagerness to attract international private investment. Peru’s sharply increasing appetite for major infrastructure investments emphasizes growing opportunities for efficient and successful PPP cooperation.