SOUTH AMERICA

New Brazilian infrastructure fund emerges

10 years ago

The Latin American Development Bank, known previously as the Andean Development Corporation (CAF), and BNP Paribas Asset Management Brasil have agreed to constitute an infrastructure investment fund.

The fund, which could be partially used to help finance Brazilian port projects, will have a start-up capital of $300m, which will be part of an incentive debentures portfolio.

However, this seed funding will represent just 10% of what the fund is expected to eventually have, with the rest of the capital to come from institutional investors abroad, such as pension funds and sovereign wealth funds. It is hoped that these additional investors will be drawn in by the fact that two powerful institutional investors are already in place for the long term.

The aim is to have the fund operational by the second quarter of 2017 and the expectation is that it will provide an alternative source of possible funding to the Brazilian Social Economic Development Fund (BNDES).