Private Finance Of Transport Infrastructure Projects

This book seeks to enhance understanding of the impacts of project setup and its implementation environment on project performance by leveraging information from the study of a rich set of European transport infrastructure project cases. It puts forward a system’s view of project delivery and aims to serve as a strategic tool for decision makers and practitioners. The proposed approach is not limited to specific stakeholder views. On the contrary, it allows stakeholders to formulate their own strategies based on an holistic set of potential implementation scenarios. Furthermore, by including cases of projects that have been influenced by the recent financial crisis, the book aims to capitalise on experiences and provide guidelines as to the design and implementation of resilient projects delivered both through traditional as well as Public Private Partnership (PPP) models. Finally, the book proposes a new Transport Infrastructure Resilience Indicator and a corresponding project rating system that can be assessed with an eye to the future, ultimately aiming to support the successful delivery of transport infrastructure projects for all stakeholders involved.

There is a growing interest to find ways and methods to finance capital investments in infrastructure by deploying private capital. Entering private capital into transport infrastructure planning, construction, and maintenance markets requires that the investors. behaviour and motives are understood. Private sector financing of infrastructure and other larger-scale investments have increasingly taken the form of project finance. The project cash flows are divided by equity investors, debt investors, contractors and suppliers and the users that receive the service. This research investigates the characteristics of a feasible framework for private finance of road infrastructure projects using one case project as an aid, which is analysed in depth. The research makes an effort to find out whether private finance of road infrastructure projects is able to bring additional benefits for the state and the project investors and whether private finance is applicable from the viewpoint of the aforementioned. The concept of risk is presented in the framework of financial theory. The relevant project cash flows are identified, as their volatility builds the risks of the project. The project cash flows are studied in detail as to how they form the value of the project. One essential outcome is the project model. The empirical model is built in view of the decision making point on case project in 1996, when the bidding for the project was officially initiated. Recent observed, real data is used to validate the project model. The sub-models of the project model include the cash flow model and the risk structure model, the former based on financial theory and Capital Asset Pricing Model, the latter based on the cash flow model and literature on risk. Simulation is used as the primary method of analysis. The primary source of time series data for economic variables, traffic volumes and road operating and construction is the Finnish Road Administration's production statistics. The case project finance is evaluated from multiple angles - what type of projects and what type of investors seem to be appropriate for shadow toll finance. Also some policy recommendations are provided. The private investors can gain by financing infrastructure projects, but it comes with a price, which is always paid by the taxpayers or users. To justify private finance, the beneficial aspects of private capital deployment must be substantial. The projects must be the best projects from a socio-economic viewpoint and not the ones that do not survive the competition in the normal budgetary process. Different risk factors are behind the long-term value risk and short-term insolvency risk of the project company. Project-specific risk factors are at least as important as economy level factors.

This paper summarizes the evidence on the evolution of transport PPPs over the last 15 years or so. In the process, it provides a primer on the associated policy issues, including of the central role of project finance in the implementation of PPP policies and the debates on risk allocation in the design of PPPs. The paper also offers a discussion of the increasingly well recognized residual roles for the public sector in transport, with an emphasis on the regulatory debates surrounding the adoption of PPPs.

Mobility is fundamental to economic and social activities such as commuting, manufacturing, or supplying energy. Each movement has an origin, a potential set of intermediate locations, a destination, and a nature which is linked with geographical attributes. Transport systems composed of infrastructures, modes and terminals are so embedded in the socio-economic life of individuals, institutions and corporations that they are often invisible to the consumer. This is paradoxical as the perceived invisibility of transportation is derived from its efficiency. Understanding how mobility is linked with geography is main the purpose of this book. The third edition of The Geography of Transport Systems has been revised and updated to provide an overview of the spatial aspects of transportation. This text provides greater discussion of security, energy, green logistics, as well as new and updated case studies, a revised content structure, and new figures. Each chapter covers a specific conceptual dimension including networks, modes, terminals, freight transportation, urban transportation and environmental impacts. A final chapter contains core methodologies linked with transport geography such as accessibility, spatial interactions, graph theory and Geographic Information Systems for transportation (GIS-T). This book provides a comprehensive and accessible introduction to the field, with a broad overview of its concepts, methods, and areas of application. The accompanying website for this text contains a useful additional material, including digital maps, PowerPoint slides, databases, and links to further reading and websites. The website can be accessed at: http://people.hofstra.edu/geotrans This text is an essential resource for undergraduates studying transport geography, as well as those interest in economic and urban geography, transport planning and engineering.

Transport infrastructure is crucial to connect developing countries and help them to boost trade, growth and regional integration. This is because cross-border or long-distance roads and railways as well as international ports and airports are needed to move products and people around in a ...

During recent decades governments all around the world were faced with a complicated set of options for investing in transport, including transport infrastructure. This publication examines main principles for determining the most appropriate models for financing transport infrastructure expenditures but also illustrates and analyses many innovative ways to finance transport infrastructure. Financing, in this context, means the provision of money at the time and in the quantity, that is needed to meet society's transport infrastructure and transport service provision needs. Thus, financing is a basic underpinning of the entire process of providing and operating transport infrastructure. Accepting the view, that transport infrastructure is needed to provide a well-defined set of public services, at the highest-level financing the transport sector, including transport infrastructure expenditures, is fundamentally a sovereign task, which involves determining how much of the government's available (public) resources will be channelled into the transport infrastructure, during a given period, as opposed to other policy priorities. However, this report proves that this is not the case anymore. There are many other innovative ways from which transport infrastructure construction could be funded other than the government's available (public) resources.

- Project finance as a tool for financing infrastructure projects - Public finance for infrastructure projects - Financial instruments - Financial engineering - Restructuring projects - Financial markets - The concession or build-own-operate-transfer (BOOT) procurement strategy - The private finance initiative - Challenges and opportunities for infrastructure development in developing countries - Financial institutions - Privatisation as a method of financing infrastructure projects - Typical risks in the procurement of infrastructure projects - Mechanism for risk management and its application to risks in private finance initiative projects - Insurance and bonding - Case study of a toll bridge project - Case study on managing project financial risks utilising financial engineering techniques

Many transport projects undertaken during the boom period of the 1990s came to a crashing halt in 1997, and conditions in emerging markets worsened in 1998 and 1999. Many projects failed, victim of everything from overoptimistic forecasts to excessive debt to an inability to refinance bridge loans. As available financing dried up, many projects went bankrupt, had to be renegotiated, or were taken over by the government. What have we learned from all this?

Infrastructure and its effects on economic growth, social welfare, and sustainability receive a great deal of attention today. There is widespread agreement that infrastructure is a key dimension of global development and that its impact reaches deep into the broader economy with important and multifaceted implications for social progress. At the same time, infrastructure finance is among the most complex and challenging areas in the global financial architecture. Ingo Walter, Professor Emeritus of Finance, Corporate Governance and Ethics at the Stern School of Business, New York University, and his team of experts tackle the issue by focussing on key findings backed by serious theoretical and empirical research. The result is a set of viable guideposts for researchers, policy-makers, students and anybody interested in the varied challenges of the contemporary economy.

Public-private partnerships (P3s) can provide solutions to the project delivery challenges faced by state departments of transportation (DOTs) and local transportation agencies in delivering surface transportation infrastructure by aligning risks and rewards between public and private sectors, accelerating project delivery, improving operations and asset management, realizing construction and operational cost savings, and attracting private-sector equity investment. P3s are becoming an increasingly important option for financing and implementing critical improvements to U.S. surface transportation infrastructure. As interest in P3s grows, U.S. transportation agencies and stakeholders evaluating the potential benefits of P3s have raised issues relating to the role of private equity in these transactions. Recognizing the complexity and challenges of structuring a highway or bridge P3 compared to a conventional procurement, the objective of NCHRP Synthesis 540: Leveraging Private Capital for Infrastructure Renewal is to bridge the knowledge gap on the role of equity in surface transportation P3 projects and to document current practices relating to private-equity investments in small-scale and large-scale transportation infrastructure projects.