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Argentina-Uruguay bridge could be duty-free bonanza
Impact International / April 1, 1997

By Larry Luxner

South America's duty-free industry could get a boost with the planned construction of a 50-kilometer bridge between Buenos Aires, Argentina, and Colonia, Uruguay.

The controversial bridge over the Río de la Plata, projected to cost more than $1.2 billion, would be paid for by truckers' tolls ranging from $60 to $110 each. Uruguayan President Julio Maria Sanguinetti says construction could begin by mid-1996, and that both the Argentine and Uruguayan governments "have made the decision to build the bridge through the public works bidding system, without diverting funds from the two states."

Under a plan proposed by Louis Berger International Inc., Bear Stearns & Co. and Latham & Watkins, the bridge will be bid as a concession with private risk capital, with the winning bidder responsible for the design, construction, operation and eventual transfer of the bridge to the two nations. These same consultants also recommend that "the bilateral commission consider the inclusion of complementary projects related to travelers' services, such as service stations, duty-free shops, hotels and restaurants."

In the absence of a bridge, most people make the trip by ferry. Several companies including Ferrylineas and Buquebus ply the 45-minute route between Buenos Aires and Colonia, and all of them have duty-free luxury shops on board. They do a thriving business in the summer, when an estimated 600,000 Argentines descend on Colonia and the Uruguayan resort of Punta del Este.

While many of Colonia's 23,000 residents fear the increased crime and traffic the bridge would bring, proponents say it would strengthen Uruguay's position within the Mercosur trade pact. Sanguinetti himself describes the bridge as "a fundamental link within a broader concept of the integration process."

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