Categorized | Business, National News

Pension Funds Funding More Infrastructure Projects In Caribbean

Pension Funds are going to be used increasingly to finance long term infrastructure development, according to the forecast of a team of international and regional investors attending the third annual CIBC FirstCaribbean International Bank Infrastructure Conference in Montego Bay, Jamaica.

Addressing the topic “Caribbean Infrastructure as an Asset Class: International and Regional Investors Perspectives,” the investor representatives included Raymond Campbell, partner KPMG Advisory; Andrew Lee, managing director, Head of Private Placements, CIBC World Markets; Lenny Mazlish, Cigna Investment Management; Rajeev Gopaul, IFC Representative for Jamaica; Douglas Hewson, managing partner, Portland Private Equity and David Clee, managing director, Corporate Credit and Structured Finance, CIBC FirstCaribbean International Bank.

It was noted that the lion’s share of funds invested in infrastructure development is currently being channeled to Australia and Europe where there are large projects which investors consider worthy of the time and ancillary costs involved in getting major projects implemented. It was also noted that investors are looking for at least 20 per cent return on equity.

Predatory and legal issues can also be a challenge for Caribbean projects according to Gopaul, who noted that “it becomes more complex when international laws are applicable due to the composition of the investor and they prefer to price in international currencies as opposed to regional currencies that may be prone to exchange fluctuations.”
In this regard Swap Protection also becomes essential to protect against the risk of foreign exchange fluctuations.

It was noted that in the region, the large projects are still being undertaken for the most part by overseas contractors who work with locals to implement them. Such projects can have very “aggressive returns” the panel concluded.

Written by Jones Bahamas

Leave a Reply

You must be logged in to post a comment.

Watch JCN Channel 14 Shows

Jcn Channel 14

Sign in now to see your channels and recommendations!

Join Us on Facebook