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Colombia 2013 | REAL ESTATE & CONSTRUCTION | INTERVIEW

TBY talks to Eleuberto Antonio Martorelli, Executive Director of Odebrecht Colombian Branch, on the impact of PPPs, ongoing projects, and the quality of local human capital.

Eleuberto Antonio Martorelli
BIOGRAPHY
Born in 1965, Eleuberto Antonio Martorelli graduated with a degree in civil engineering and later obtained a Master’s in Finance and also an MBA in Brazil. He has more than 20 years of professional experience, working on and managing major infrastructure projects in Brazil, Ecuador, and Peru. With 23 years in the Odebrecht Organization, he is currently the Country Executive Director of Odebrecht Colombia.

How would you assess the current state of development of the infrastructure sector in Colombia, and what impact will public-private partnerships (PPPs) have on the industry?

We currently operate in Colombia as a concessionary for Ruta del Sol Sector II, a road infrastructure project that goes from Puerto Salgar in Cundinamarca to San Roque in César, and has an approximate length of 528 kilometers. Our expected investment in the project will be Ps3.4 billion. Our partners are the Colombian companies Estudios y Proyectos del Sol and CSS Constructores. In this regard, we are very interested in the further development of infrastructure projects in the country, and we welcome the great efforts made by the government of Colombia to boost the sector. In this context, PPPs will be key in the future development of the industry.

How is the Ruta del Sol project progressing, and what does this project mean for the country?

We are pleased with the development of the work so far, as we have paved more than 110 kilometers already, and we expect to completely finish it by April 2016. The project is of high importance for the country, as it will be the final link between the mountains and the coastal cities of Barranquilla and Cartagena. It will definitely contribute to the development of the logistics and tourism sectors of the country. Currently, around 70% of the users of the Ruta del Sol road are heavy vehicles. We also have to put this crucial project into context, because after the several free trade agreements (FTAs) Colombia has signed, the project has become essential.

What is behind the potential partnership agreement with Riopaila?

We have been talking to many different stakeholders in the Colombian ethanol industry to get a better understanding of the local market opportunity for ethanol. We believe that ethanol could play an important role in the energy sector, boosting gasoline fuel by adding up to 20% to the mixture. We would love to support Latin American countries to develop their ethanol production capacity, increasing renewable energy participation in the energy matrix, and contributing to reducing CO2 emissions and making ethanol a worldwide fuel solution. Odebrecht is also open to entering the energy sector, where we have already several ongoing projects in Brazil and Peru. In this context, the Colombian energy sector is rapidly growing and Odebrecht can contribute to such development thanks to its international experience. We are currently looking into specific projects within the generation segment. However, we mostly focus on infrastructure and road projects in Colombia right now, and the other option could be a medium- to long-term vision.

What are some of the other ongoing projects for the company in Colombia?

We are very interested in all of the fourth-generation PPP projects the government plans to widely tender, and we evaluated all of the proposed projects. At the moment, we are preparing for the pre-qualification process. We are mainly talking about four processes named Victorias Tempranas, Cartagena-Barranquilla, Girardot-Puerto Salgar, the circumvallation of Bogotá and Mulalo-Loboguerrero road projects. We believe we can qualify for all of the tendering processes. However, the competition will be tough.

What are the main challenges the road infrastructure industry faces in Colombia?

The government has a very ambitious plan to construct dual carriageways. For example, we constructed 76 kilometers of dual carriageway out of the 207 kilometers constructed in 2012. In 2013, we have already developed 30 kilometers of this type of road infrastructure. The main issue for the future will be to de-bureaucratize and accelerate processes because issues regarding the mitigation of the environmental impact of the projects are slowing them down heavily, especially in terms of environment licenses. Simplifying the process would be key for the country to capitalize on the huge growth and development capacity that it has. In addition, the development of road infrastructure projects is essential for Colombia to take better advantage of the numerous FTAs it has recently signed. These types of projects will not only benefit foreign companies coming to Colombia, but will make local companies more competitive as well.

How would you rate Colombia's human capital?

I believe that sourcing human capital is one of the main challenges ahead for the country. In our particular case, we base our success on the expertise and quality of human capital; wherever we set up operations, we always aim at hiring the highest number of local workers. I would even say that this challenge does not only apply to Colombia, but many countries in the world. Hiring and integrating them into the company's structures is a very tough challenge. In Colombia, there are a reduced number of Brazilian expatriates working for Odebrecht. In this context, we have our in-house facilities to train workers and integrate them into our structures. Outsiders are also welcome to join our programs, as it also works as a small university that offers job opportunities afterward. For example, in 2012 we hired around 4,000 people worldwide out of 7,000 trainees. In 2013, we want to maintain these figures because the industry and the development of many Latin American economies require it. In addition, and in the context of Colombia, we also have several agreements with universities, and for example, we have 45 such graduates currently working for Odebrecht.

How do you see Odebrecht's operations evolving in Colombia, and what roles does Colombia play in the company's overall activities?

Currently, Peru and Colombia represent the most important operations in the South American region for the company. Today, we have two key projects in Colombia—the Ruta del Sol Sector II and the transversal road of Boyacá. Obviously, Ruta del Sol is a key project not only for Colombia, but for the company's global operations, and for that reason it is our main focus at the moment. At the same time, there are some potential projects such as the roads I previously mentioned. We are also studying the navigability of the Magdalena River. There is huge potential to further expand our activities in the country, and I believe Colombia will become an even more important market for the company's global operations. Odebrecht is open to analyze and explore new projects in Colombia, a country that holds great potential in terms of road, maritime, and energy infrastructure projects. Cartagena and Barranquilla need to see further developments in their maritime infrastructure in order to be able to better channel the opportunities that will come from the FTAs, and our company is more than ready to step into any interesting project in this field, regardless of it being private or public.