Korea, with CABEI support, presents preliminary pre-feasibility results of freight rail project in Guatemala

Guatemala City, October 27, 2021.-  As part of the "Prefeasibility Studies for the Guatemalan Segment of the Central American Freight Railroad Connection Project", it was concluded that its economic viability is generated when the freight railroad is operated simultaneously with the passenger train on double track.

This is part of the scopes presented at the final seminar of the Knowledge Sharing Program (KSP) of the Republic of Korea in coordination with the Central American Bank for Economic Integration (CABEI) with the participation of the Public Finance Ministry (MINFIN) y Ferrocarriles de Guatemala (FEGUA).

"These studies are relevant not only for Guatemala, but also for Central America, given that they will enable the development of a high-impact initiative in cargo transportation, facilitating regional trade and improving competitiveness levels by reducing logistics costs in domestic markets," commented CABEI Executive President, Dr. Dante Mossi.

Mr. Junghwa Seo, Director of the Multilateral Development Banks Department of Korea Eximbank, added: "The implementation of the project would have positive economic effects on employment generation, revitalizing the local economy and reducing operating and transportation costs. It is important that Guatemala establishes phased routes for freight transport and connection with central stations as well as a national Railway Master Plan".

The prioritized freight railroad route is the Tecún Umán - Guatemala City line, with a length of 274 kilometers, which would have a direct impact on 52 municipalities in the project's area of influence. In addition, infrastructure expansion projects are being carried out in the vicinity of some rail lines, such as the Pacific freight railroad and the El Salvador railroad project, which will enhance economic development in this sector at the binational level.

Agusto Ponce, FEGUA's controller, commented: "We recognize the great step that Guatemala will take with the development of these studies implemented by Korea in collaboration with CABEI, which will open up the railway management that Guatemala needs so much, not only in freight transport infrastructure, but also for passengers".

"We thank Korea and its various ministries and institutions and CABEI for the development of such an in-depth railway study with a high potential in social, economic and financial terms, which would improve the country's logistical mobility, competitiveness and the way to transit once the project becomes a reality," commented Rosa María Ortega, Director of Public Credit at MINFIN.

The studies are part of non-reimbursable technical cooperation granted to Guatemala by the Republic of Korea, CABEI's extra-regional partner country, for US$466,900 through the KSP of the Korean Ministry of Economy and Finance (MoEF), and executed through the Export-Import Bank of Korea (Korea Eximbank) with the active support of CABEI and FEGUA.