Best Practices in PPP Financing Latin America - e-Institute - World ...

Best practices in Public-Private Partnerships financing in Latin America
Chart N.3
CRPAO
Operation
US$ for
CRPAO purchasing
(with discount rate)
Investment Banking
CRPAOs
US$
US$
Investors
CRPAOs
Ministry of Transport
Government
PPP operator
CRPAO Payment
Disbursements / financing
Re paid loan
Issued and CRPAO´s sell
Source: Sergio Bravo.
recognize the payments for construction work that is in
progress. The Supervising Agency of Investment in Public
Transport Infrastructure Facilities (OSITRAN) issues the WPC
or CAO, which represents the physical construction in terms
of quantity or as a percentage of the total project. After the
issuance of the WPC, the Ministry of Transport issues the
CRPAO. The CRPAO is a financial instrument with irrevocable
and unconditional characteristics, payable in 15 years, on a sixmonth
basis (See Chart N.3).
Recognition Certificates of Investment Payments
(CRPI)
The main difference between CRPI and CRPAO is that the
investor issues the CRPI. The CRPIs are issued depending on the
WPCs, or underlying asset. The risk of the financial instrument
will depend on the quality of the payment source (liquidity). In
the case of Peru, the social security (ESSALUD) funds have to
be separated in a former account, allowing for isolation of the
economic and financial risks of the institution (See Chart N.4).
CRPAO and CRRPI reduced the effect of construction risk
on financers, because payments are recognized as the
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