MIGA Guarantees Underpin Vital Toll Road in Honduras

MIGA Guarantees Underpin Vital Toll Road in Honduras 
Road will increase economic activity and safety in country’s north

Washington, DC, April 22, 2015—The Multilateral Investment Guarantee Agency (MIGA), the political risk insurance and credit enhancement arm of the World Bank Group, announced today its support to the Corredor Turístico toll road in Honduras. This road will better connect San Pedro Sula, La Barca, El Progreso, Tela, and La Ceiba—increasing economic activity and safety in these important cities in the north of the country.

The MIGA-supported project consists of the upgrade, expansion, operation, and maintenance of approximately 220 kilometers of road and rehabilitation of two bridges carried out under a 30-year concession agreement between Autopistas del Atlántico, S.A. de C.V and the Government of Honduras. MIGA is providing guarantees of US$124.3 million to two of the project’s lenders, JPMorgan Chase Bank and the Corporación Interamericana para el Financiamiento de Infraestructura (CIFI).

The toll road will improve the connectivity between Honduras’ second largest city and the coast—servicing commuter traffic between San Pedro Sula and El Progreso, agro-industrial traffic on the Atlantic coast, and tourist traffic towards Tela and La Ceiba.  Fully funded by the private sector, the project also provides a needed stimulus to strengthen the country’s infrastructure network while alleviating pressure on public finances. This underlines the viability of the public-private partnership framework recently endorsed by the Government of Honduras.

MIGA’s participation was instrumental to mobilize financing that matched the size and long-term nature of the project, which otherwise would not be available.

“While improved infrastructure is critical to reducing poverty and boosting shared prosperity in Honduras, it is an expensive endeavor,” said Keiko Honda, MIGA’s Executive Vice President and CEO. “Here, MIGA’s guarantees have facilitated the participation of commercial financing to relieve fiscal pressure from the government—allowing the country to spend its funds on other initiatives that enhance human development.”

“We’re pleased to work with MIGA and the Government of Honduras to deliver a solid financing solution for this toll road that will contribute significantly to the country’s economic dynamism,” said Daniel Simon, Executive Director at J.P. Morgan Chase & Co. “This is a landmark transaction for the country and we are proud to be part of the financing.”

“The Corredor Turístico toll road is an important example of how governments in Latin American and the Caribbean can use private-sector and multilateral tools that are at their disposal to move priority infrastructure projects forward,” said Cesar Canedo, Managing Director, Structured and Corporate Finance for of CIFI. “We’re happy to be part of this project that underscores Honduras’ commitment to new financing models.”

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MULTILATERAL INVESTMENT GUARANTEE AGENCY
A Member of the World Bank Group
1818 H Street, NW, Washington, DC 20433

MIGA Contact:
Mallory Saleson, MIGA
Tel: +1 202 473-0844
E-mail: msaleson@worldbank.org

Rebecca Post, MIGA
Tel: +1 202-473-1964
E-mail: rpost@worldbank.org

Cara Santos Pianesi, MIGA
Tel: +1.202.458.2097
E-mail: csantospianesi@worldbank.org