FLIGHT OF THE CONDOR

Colombia 2020 | TRANSPORT | INTERVIEW

Balancing growth in demand with sustainable and equitable expansion will remain one of the leading challenges for the ministry going forward.

Ángela María Orozco
BIOGRAPHY

Ángela María Orozco holds a degree in law and socioeconomic sciences from Universidad Javeriana in Bogotá and a master's in comparative jurisprudence from the University of Texas. Before becoming the Minister of Transportation, she was president of the Colombian Association of Edible Fats and Oils Producers. She is also a founding partner of the firm Research and Opportunities. Her former positions include minister of foreign trade, president of Proexport, and vice president of the Colombian Association of Flower Exporters. Previously, she was also a lecturer of international trade at Universidad Javeriana and the senior management program at Universidad de los Andes.

How can Colombia invest in air transport infrastructure to meet its full potential?
In the last 12 years, Colombia has posted impressive growth, increasing from 12 million passengers per year in the country to 38 million in December 2018. That is mainly because Colombia has many large cities within a diversified geography. The Civil Aviation Authority has been developing an infrastructure plan and will invest around COP1 billion in different regional airports as part of its 2030 plan. This includes not only investment in infrastructure but the possibility of having new concessions in some of the regional airports and developing new PPPs to expand several capital airports and develop new aerial bilateral agreements. We already have 64 bilateral aerial agreements but are on the verge of having 17 new agreements with 15 countries by the end of 2020. The growth of the aviation sector was due to the economic growth of Colombia, which resulted in a stable middle class, in turn leading to the rise of low-cost airlines. Colombia is growing at a rate of 3.5%, which compares favorably to many of our partner countries and the developed word. Moving forward, we have a huge infrastructure challenge because of the development and investment done by the Civil Aviation Authority. Some of these airports are located in remote regions where the only airline that operates is the state airline, Satena.

How is the government planning to restart and complete the 4G projects?
The government has already delivered. When the new government came into power, of 30 projects, six were proceeding as planned, three had some issues, and 21 were halted. Notwithstanding the contracts signed between 2014 and 2016, only minimal work had been done on most of them. This was for many reasons: administrative, environmental, and a lack of government coordination. Designing, structuring, and financing a project is one thing but constructing it is something else. The National Infrastructure Agency (ANI) was a new entity that was strong on the financial side but weak on the territorial and execution side. This is why we had an economic activation room in August 2018, where we sat down with all the actors and the attorney general's office to determine the problems and propose alternative solutions. Once this public document was released, we started executing decisions and solutions. We set the target to enforce 70% of the projects by March 2019 and achieved this with 21 projects underway by the end of March. Civil construction fell in the first three quarters of 2018, respectively, and by 4Q2018 we increased it by 5.5%. In 1Q2019, the sector grew by 6.5%, which is more than the economy as a whole. During this period, we had two new financial closes; by December 2019, we delivered at least five more financially closed projects. Notably, some projects are happening even without the financial closure since people are putting money in with a bridge loan or equity. We took decisions, negotiated transaction agreements, signed modifications to contracts, and developed a strategy with the Colombian environmental agency to give alternatives to several projects, such as La Ruta del Cacao, which did not have financial closure due to uncertainties about an environmental license. The original proposal was rejected, but we gave time and space with an alternative location for the road. This gave bankers greater confidence in order to close the financial deal. This is how we have been working on different projects, such as the Cambao-Manizales route, where we are on the verge of signing a new agreement thanks to an alternative found for the environmental license. There were challenges in terms of a reduction in income due to less traffic, which is why we came up with a new agreement in recognition of the reduction of traffic.