Medellin’s Mayor Daniel Quintero Defends His Record On Foreign Direct Investment, Discusses Plans For New Airports
Finance Colombia recently attended the Medellin and its Allies event organized by ACI Medellin, the city’s investment promotion agency. Medellín’s Mayor Daniel Quintero was present to greet the many dignitaries, diplomats and international mayors that flew in for the two day event. While Quintero is locally known for his reluctance to do media interviews, Finance Colombia executive editor Loren Moss was able to speak to him briefly and discuss ACI’s performance, and the mayor’s plans for the airports serving Colombia’s second largest city.
Finance Colombia: Mayor, during your campaign you talked a lot about making Medellin the Software Valley, and we still hear a lot about that slogan. Medellin has an international reputation as a technology center. My question is, in the last two years of your administration, can you talk about any success regarding attracting international investment related to technology, services, BPO, ITO, and informatics? Can you give some examples of how you really are making Medellin the Software Valley because of any particular companies that have arrived, and grown here? Can you please provide some examples?
Daniel Quintero: There are plenty, I’ll tell Eleonora (Betancourt, director of ACI Medellín) to provide more examples, but we have for instance the arrival of Alibaba, MercadoLibre, Indra, Conecta, and many other companies that come also in the need of human talent that can be measured in thousands: they need 500, 1000, 1200 people, but besides that we know that there will be many other companies coming. We have received 34 companies in the last two years. Last year the investment achieved $382-383 million, but there is more coming, because a month ago, the president approved the bill for the conversion of Medellin from municipality to Science and Technology District.
Last week we issued our first tax statute, which for the first time benefits the technology companies located in the territory, and even more to those located in the orange zones or free zones, and because for the first time in the congress there is a bill that will provide tax benefits at a national scale, for the companies that are in the territory. What’s interesting is that both local and national governments are aligned to create benefits, and the companies are perceiving these signs, so they locate here. What we believe is that this, when added to the investments in education, will create the other variable that will be very interesting, indispensable for any technology company.
Finance Colombia: You and I were in the event where Viva announced their plans to do with Medellin basically what Copa did with Tocumen International Airport in Panama, but you mentioned something very interesting and that is that there is a plan to close the city’s Olaya Herrera municipal airport and move the traffic to the international airport in (the Medellín suburb of) Rionegro. That’s curious because speaking with Viva, they agree as well that it can be a good idea, but Rionegro has only one runway and it’s already busy; which is good for Medellin, but isn’t that a risk? Because Bogota already has issues with delays, and also the international airport is out of the direct control of Medellin, because is in Rionegro, so how do you see the possibility? Is it more like a dream or is it a real plan? What are the obstacles, and logistically, because here we have a lot of local flights and private flights, wouldn’t it be a problem logistically for the city, and also politically, since that airport is out of the control of the city? How do you see that?
Daniel Quintero: First of all, Medellin has always had a strategic point of view, besides having a very corporate vision, Medellin is one of the cities in Latin America with the most public companies. For example, EPM is a public conglomerate of gas, water, water cleaning, telecommunication; for instance Tigo, which is let’s say 50% plus a share of the city of Medellin through EPM, and with airports the story is similar.
Medellin is partner in the ownership of 5 airports in Colombia: Rionegro, Olaya Herrera, Encarepa, Enquito, Corozal Sucre. When an airplane lands in any of those airports, Medellin earns some pesos, and is involved permanently in the investment decisions of these airports in which we are partners, where Medellin participates as a shareholder. In order to guarantee the development, Medellin amplifies its aerial connectivity as a fundamental principle, and requires very important investments.
Medellin has another feature, that it often makes investments out of its territory, as long as it represents a strategic advantage. For example, the Toyo Tunnel, which is hundreds of kilometers away, where Medellin invested more than 400 billion pesos, but that definitively is one of the 4G (highway projects) of the country that normally is made with national investment. It has never happened before a that a city itself invested in a project to be completed and executed in Colombia, but in Medellin it is possible, so what have we proposed to the national government? First, that Medellin purchases the necessary land to be able to build the second runway for Rionegro. We are talking about an investment that surpasses 500 billion pesos, close to 500 hectares or a bit less, but there is more participation in the construction of the Rionegro airport, a runway with a terminal, which would pass from 150,000 to 300,000 daily operations. Today, the airport is at 80,000 daily operations average. Additionally, the purchase of 1,000 hectares in the east, and 1,000 hectares in the west in a valley named San Pedro de los Milagros, or Nus Valley, to build another airport, which would increase the aerial connectivity of the city. Let’s say it’s not immediate, but at the beginning, it would have a small runway, which would look like the one we have at Medellin’s Olaya Herrera municipal airport, which has 130 hectares. We are talking about 1,000 hectares, so we’d have 2 airports, one military and another for passengers in San Pedro de los Milagros, and the reconditioning of an old airport, which unfortunately was being used for drug traffickers for a long time, also in the east, but towards Santa Fe de Antioquia.
A reconditioning of a small airport that would work for touristic aviation trips or rather private planes, and for aviation schools, but also I say touristic because it’s an area with a touristic potential that no doubt will be developed. Besides with the tunnels that are being built, many of them will be completed in December of this year, and these are the same that work towards the west, that include the Toyo Tunnel, so we invest as a city in that road, which is a national road, this is part of the mega projects of the city that don’t happen necessarily in the territory, not only in this administration but in the past ones as well, acknowledging that not only guarantees the future of a city looking at it, but at the whole region.
It’s not difficult, you know, because there is some sort of inertia around a topic of thinking Medellin in the future, the challenges from today. There is a culture that every mayor leaves a project so the next mayor executes them. I am executing projects that my predecessors left, and I’m going to leave projects that my successors will execute. Medellin always challenges itself to decade lasting projects, so we are equally happy by designing and executing these projects, as well as those who help with the delivery and opening, because there are those who design, those who execute and those who deliver, no matter in what stage we are we feel very fascinated and excited in being part of this process.