Private Participation in Infrastructure Database

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This series reviews new private participation in infrastructure (PPI) projects.

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Private Activity in Infrastructure Slowed Down in the First Half of 2011

2012-01, World Bank

New private activity in infrastructure in developing countries declined in the first semester of 2011, but remained strong and continued to be highly selective, according to data from the private participation in infrastructure project database. Most of the new activity was concentrated in a few countries, particularly India, and Greenfield projects. In the first semester of 2011, 117 infrastructure projects with private participation reached financial or contractual closing in 20 low and middle-income countries. These projects involved investment commitments (hereafter, investment) of US$42.9 billion. Such level of activity represents a decline of 8 percent by investment and 8 percent by number of projects from the level reported in the first semester of 2010. Although investment declined from 2010, private activity in the first semester of 2011 remained high when compared with previous periods and was the fourth highest level since 2000.

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Private Activity in Latin America Declined Sharply But Became More Dispersed in 2010

2011-08, World Bank

In 2010, 54 infrastructure projects with private participation reached financial or contractual closure in 11 low and middle-income countries in Latin America and the Caribbean, involving investment commitments (hereafter, investment) of US$12.3 billion. Infrastructure projects implemented in the 1990-2009 period attracted new investment of US$21.9 billion, bringing total investment in infrastructure to US$34.2 billion in 2010. Such level of activity represents a 37 percent drop by investment and a 24 percent decline by the number of projects from 2009. The decline in regional activity was driven by the slowdown in new projects which saw their investment drop by 62 percent from 2009. Most of the decline in new projects occurred among large projects (US$500 million or more) which saw their investment fall by 76 percent in 2010 compared with 2009. By contrast, additional investment in projects implemented in 1990-2009 remained stable compared with 2009. Regional investment was less concentrated on Brazil and more widespread across other countries than in the previous year. Brazil saw its share in regional investment decrease from 81 percent in 2009 to 53 percent in 2010 due to a 59 percent decline in investment in the country. Certainly, Brazil accounted for the decline in regional investment. If Brazil were excluded, investment in the region would have grown by 50 percent in 2010 compared with 2009. The 11 countries with new projects in 2010 represented a larger geographic scope for new activity than in 2009 and 2008 when only eight countries implemented new projects each year. In 2010 Brazil had 18 new projects, Argentina and Mexico followed with eight and seven new projects, respectively. Chile, Colombia and Peru each had five new projects. Nicaragua had two projects while Guatemala, Honduras, Jamaica, and Panama each implemented one new project.

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Investment in New Private Infrastructure Projects in Developing Countries Slowed Down in the First Quarter of 2010

2010-09, World Bank

This review sheds some light on recent private participation in infrastructure (PPI) activity, the short-term impact of the financial crisis and its aftermath. Compared with the previous update on the impact of the crisis, this note incorporates two improvements: a larger sample size (1,080 projects, up from 965 in the previous update) over a longer period (from January 2008 to March 2010). The findings of the survey show that investment growth in PPI projects continues to be concentrated in the largest developing economies, particularly India. The remaining developing countries saw some investment recovery in the first quarter of 2010. However, it is too soon to assess whether this recovery will continue and reverse the trend of declining investment in these countries.

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Assessment of the Impact of the Crisis on New PPI Projects - Update 4 : New Private Infrastructure Activity in Developing Countries Recovered in the First Half of 2009 Thanks to the Electricity Sector, But the Crisis Continues to Impact Projects

2009-10, World Bank

This review of new private participation in infrastructure (PPI) projects, covering the period up to June 2009, sheds some light on the recent activity and the short-term impact of the financial crisis, compared with the previous updates on the impact of the crisis, this note incorporates several improvements: a larger sample size (714 projects versus 522 in the previous update) over a longer period of time (from January 2008 to June 2009 compared to the previous update, which covered January 2008 to March 2009). The survey finds that the financial crisis significantly affected the rate of project closure rate of new PPI projects in the second half of 2008. The impact of the crisis varies across developing regions with Europe and Central Asia (ECA) being the most affected region so far. This analysis will be refined in the coming quarters to assess the extent to which these trends continue.

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For Fifth Consecutive Year India Drove Private Activity in Infrastructure in South Asia to a New Peak in 2010

2011-08, World Bank

In 2010, 102 infrastructure projects with private participation reached financial or contractual closing in 4 low- and middle-income countries in South Asia, involving investment commitments of US$47 billion. Infrastructure projects implemented in the 1990-2009 period attracted new investment of US$26.5 billion, bringing total investment commitments (hereafter, investment) to infrastructure sectors to US$73.5 billion in 2010. The activity in 2010 represents an increase of 72 percent by investment and 70 percent by number of projects compared with 2009. The growth rate of investment is particularly significant given that investment in the region had been growing since 2006 but at a lower rate. Investment in new projects grew by 54 percent from 2009, and additional investment in projects implemented in 1990-2009 rose by almost 120 percent.

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Private Activity in Infrastructure in the Middle East and North Africa Remained at low Levels in 2010

2011-08, World Bank

In 2010, three infrastructure projects with private participation reached financial or contractual closure in three low- and middle-income countries, involving investment commitments of US$1.1 billion. Infrastructure projects implemented in the 1990-2009 period attracted new investment of US$5.8 billion, bringing total investment commitments (hereafter, investment) to infrastructure in the region to US$6.9 billion in 2010. This level of investment is similar to the one reported in the region in 2009 (US$6.8 billion). However, private activity by number of projects is one third of the one reported in 2009 during the previous year (nine new projects in 2009).

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Assessment of the Impact of the Crisis on New PPI Projects : Update Six

2010-05, World Bank

Investment commitments to new infrastructure projects with private participation (PPI projects) reaching closure in developing countries grew by 15 percent in the fourth quarter of 2009 compared with the same period of 2008-and by 15 percent in 2009 as a whole. These growth rates indicate a strong recovery from the 45 percent drop in investment commitments in the second half of 2008 compared with the same period of 2007. But investment continued to grow selectively, concentrated in large energy projects in a few countries-Brazil, China, India, and Turkey. The crisis continues to affect new PPI activity. Some planned projects are still being delayed, restructured, or, to a lesser extent, canceled. Transport continues to be the most affected sector, Europe and Central Asia the most affected region, and low-income countries the most affected country income group. Despite the more difficult environment, developing country governments remain committed to their public-private partnership (PPP) programs, as confirmed by the number of new projects that were being tendered, awarded, or restructured in the fourth quarter of 2009. Commercial bank lending remains constrained, and the choices of investors and financiers continue to reflect the 'flight to quality.' For projects able to raise financing, the conditions are more stringent, with a higher cost of debt, lower debt/equity ratios, shorter tenors, and more conservative structures. But the impact of the crisis has varied across countries, depending on whether there is an active local financial market and whether the government has taken proactive measures to foster liquidity.

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Private Activity in Infrastructure in Sub-Saharan Africa Remained Stable in 2010

2011-08, World Bank

In 2010, 13 infrastructure projects with private participation reached financial or contractual closure in 11 low- and middle-income countries, involving investment commitments of US$1.5 billion. Infrastructure projects implemented in the 1990-2009 period attracted new investment of US$11.1 billion, bringing total investment commitments (hereafter, investment) to infrastructure in the region to US$12.6 billion in 2010. This level of activity is similar to the one reported in 2009, which saw 11 projects and US$12.6 billion in total investment. In 2010, investment in new projects increased by 21 percent compared with 2009 while investment in previously implemented projects declined by 3 percent.

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Investment in New Private Infrastructure Projects in Developing Countries Slowed Down in the First Quarter of 2010

2010-09, World Bank

Investment commitments to new infrastructure projects with private participation (PPI projects) reaching closure in developing countries fell by 25 percent in the first quarter of 2010 compared with the same quarter of 2009. The absence of unusually large projects (US$4 billion or more), such as those that reached closure in the first quarter of 2009, explains the investment decline. If those projects were excluded, investment would have grown 17 percent in the first quarter of 2010 compared with the same quarter in 2009. New PPI activity was concentrated in India, which accounted for more than half of investment in the first quarter of 2010. Three other large economies (Brazil, China, and Turkey) saw lower investment in this quarter than in the same quarter of 2009. The remaining developing countries saw some investment growth. By sector, energy continued to account for the bulk of new investment despite the investment drop in the first quarter of 2010. In transport, investment was stable compared with the first quarter of 2009. In water and sewerage investment grew although it remained at a very low level. Across sectors, new private activity, as measured by the number of projects, fell by 25 percent in the first quarter of 2010 compared with the same quarter of 2009.

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Assessment of the Impact of the Crisis on New PPI Projects : Update Five

2010-02, World Bank

Investment commitments to infrastructure projects with private participation (Private Participation in Infrastructure (PPI) projects) reaching closure in developing countries grew by 22 percent in the third quarter of 2009, and by 10 percent in the first three quarters of the year, compared with the same periods of 2008. These growth rates indicate a strong recovery from the 54 percent decline in the second half of 2008 compared with the same period of 2007. But investment grew selectively, concentrated in large energy projects in a few countries: Brazil, India, and Turkey. The Russian Federation, by contrast, saw a sharp decline in investment as a result of the global financial crisis and the end of the RAO UES privatization program. If these four countries were excluded, investment in developing countries would have fallen by 49 percent in the third quarter of 2009, and by 5 percent in the first three quarters, compared with the same periods of 2008. Among sectors, energy was the only one with investment growth in 2009, thanks to activity in greenfield power plants. Across sectors, large projects (US$500 million or more) accounted for the investment growth. Private activity as measured by number of projects remained slower than before the full onset of the financial crisis. The number of projects reaching closure was 27 percent lower in the third quarter of 2009, and 10 percent lower in the first three quarters, than in the same periods of 2008. These trends suggest greater project selectivity. Indeed, the large projects that are reaching closure are characterized by strong economic and financial fundamentals and the backing of financially solid sponsors and governments.