The financial package has a term of up to 17 years and comprises a senior loan of up to $US 440m and a subordinated loan of up to $US 60m. The package is being financed by IDB Invest and a group of commercial banks and international investors.

The PPP Central Railway project involves reconstructing the 273km line connecting the port of Montevideo with Paso de los Toros in the department of Durazno, where Finnish paper producer UPM is building a new pulp mill.

Traffic on the line is expected to include cellulose pulp, timber, grain, containers, fuel and chemical products.

In addition to freight traffic, nine passenger services a day will operate between Montevideo and 25 de Augusto.

The project is being implemented by the Vía Central consortium of Saceem (Peru), Sacyr (Spain), Berkel (Uruguay), and NGE (France) has been selected for the contract to build the line. Construction is due to take 33 months.

Infrastructure will be specified in compliance with European Technical Specifications for Interoperability (TSI).