Publication: Private Participation in the Transport Sector : Lessons from Recent Experience in Europe and Central Asia
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2009-06
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2014-03-28
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This report was commissioned to draw lessons from the experiences with public private partnerships (PPPs) in the transport sector in Europe and Central Asia (ECA) countries. The report will review experiences to date with private participation in the transport sector with a primary focus on experiences in the ECA countries and Europe. To carefully prepare and select the most desirable PPP projects during the most severe economic downturn since the Second World War, availability of regional best practices would be helpful. This report will provide guidance for successful PPP implementation and will hopefully encourage public authorities to critically evaluate their project designs. The lessons from this study apply regardless of the financial crisis. While the dire economic environment will considerably impact the current PPP pipeline, the fundamental success factors for these projects will remain the same. During times of economic turmoil, evaluating past investment projects can provide lessons for stimulating the next period of economic growth. The report discusses the impact of the financial crisis separately in annex B.
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“Cuttaree, V.; Humphreys, M.; Muzira, S.; Strand, J-P.. 2009. Private Participation in the Transport Sector : Lessons from Recent Experience in Europe and Central Asia. Transport paper series;no. TP-24. © http://hdl.handle.net/10986/17462 License: CC BY 3.0 IGO.”
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In the research undertaken for this study, it appears that most crisis-specific issues are cross-sectoral, therefore requiring cross-sectoral responses. The intended audience for this report includes national government stakeholders involved in infrastructure financing, including Ministries in charge of infrastructure, especially transport, energy, and water; state-owned enterprises with operational responsibilities, such as road directorates; and Ministries of Finance and development banks involved in PPP. This report reviewed the region's experience in PPPs in infrastructure before and during the financial crisis period (from late 2006 to 2010). Since not all ECA countries have had successful or ongoing PPP projects during this time, the report draws on lessons from Brazil, India, Spain, and the United Kingdom, countries with established PPP project pipelines to draw on cross-sectoral lessons. The findings can be used by countries wishing to start or re-start their PPP program following the impact of the recent crisis. However, beyond the crisis and its effects, the report can also guide future development of sustainable and crisis-resilient PPP programs. Most of the analysis supporting the report recommendations was undertaken for the highway sector and was financed through from a grant from the transport research support program. Initially, the highway sector was the focus of this study but the scope was later widened to include all infrastructure sectors because most issues facing highway PPP projects are common to other sectors requiring a cross-sectoral approach to PPP. Sector-specific strategies for highways have been documented in a recent World Bank study.Publication Privatization and Regulation of Transport Infrastructure in the 1990s(Washington, DC: World Bank, 2001-04)Although the link between improved infrastructure services and economic growth is uncertain, it is clear that reforms aimed at creating competition and regulating natural monopolies establish an environment conducive to private sector participation, incentives for companies to strive for efficiency savings that can ultimately be passed on to consumers, and greater provision of services (such as faster roll-out of infrastructure or innovative solutions to service delivery for customers not connected to an existing network). In determining the form that infrastructure restructuring might undertake or the design of a regulatory agency, policymakers can generally benefit from a review of the experiences of other countries. 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Some PPP projects at an advanced stage of procurement may need additional public support, while ambitious projects may need to be phased to reduce their scale to what the market can absorb.Publication Public-Private Partnerships in Transport(World Bank, Washington, DC, 2007-12)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.
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