Development banks are looking to Latin America’s mining sector as a source of new borrowing amid a shortage of infrastructure projects in the region.
US Exim Bank is building a pipeline of financing deals focused on critical mineral mining projects in Chile, Colombia, Peru and Guyana as part of the export credit agency’s plan to regain the “presence and relevance” it once had in the region, Sarah Whitten, the bank’s chief commercial officer, said Tuesday in a panel discussion hosted by the Atlantic Council in Washington, DC.
“These countries that have a lot of mineral deposits and endowments that have been lacking in US investments, these are the types of markets that we want to be leaning into,” she said.
As part of its strategy, Exim Bank wants to partner with multilateral banks that have “decades of experience on the ground” in Latin America, said Whitten.
“Some of the best transactions that have come through our pipeline in the last six months have been referrals through these partnerships,” she said.
The agency recently signed a non-binding term sheet of up to $6 billion for a $51 billion LNG export project that Argentina’s state-owned energy company YPF is helping develop in the south of the country.
Antonio Silveira, CAF’s vice president of private sector financing, said that there isn’t a pipeline of “very good and bankable” infrastructure projects. Many investment banks are looking to refinance existing projects instead of funding new ones, he said during the event.
The development bank is working on closing its first mining project in Chile, he added, without providing details.
CAF approved $3.5 billion in loans for the region earlier this month.