Publication: Road Infrastructure Concession Practice in Europe
Loading...
Published
2001-09
ISSN
Date
2014-08-21
Author(s)
Editor(s)
Abstract
In a road infrastructure concession, a public authority grants specific rights to a private, or semi-public company to construct, overhaul, maintain, and operate infrastructure for a given period. By contract, the public authority charges that company with making the investments needed to create the service at its own cost, and to operate it at its own risk. The price paid to the company comes from the service's users, the public authority, or both. In 1999, out of roughly 51,000 kilometers of European motorways, about 17,000 kilometers (33 percent) were concessioned - 16,400 kilometers by toll, and 670 kilometers by shadow toll (design, build, finance, and operate arrangements). Of these, 73 percent are managed by the public sector, and 27 percent by private companies. State-owned companies have been important in European motorway concessions. Systems vary among countries, for example, in how they share risks between the concession authority, and the concession company. As the motorway network has grown denser, attributing commercial risk has become more difficult. Increasingly, public authorities must play a greater regulatory role. Already, bad experiences have made the private sector reluctant to bear the commercial risk. Ant the commercial risk is sometimes too great to be carried by the concession company alone. Commercial risk should be controlled by mechanisms incorporated in the contract, but control of the commercial risk must not eliminate incentives. In addition to safeguarding the community's interests, the public concession authority, must increase citizen awareness about concession decisions, to ensure their social acceptability. Formulas for determining toll charges, differ through Europe. So do criteria for selecting concession companies. In 1999, the main criteria used were these: 1) the amount of public subsidy required; 2) the credibility of the financial arrangements; 3) the project's technical quality; 4) the operating strategy, and price policy; and, 5) the reputation of the concession company (whether it has a construction company among its shareholders, for example). The increasingly frequent use of private funding, must be taken into account when defining the training required by personnel responsible for monitoring the concessions.
Link to Data Set
Citation
“Bousquet, Franck; Fayard, Alain. 2001. Road Infrastructure Concession Practice in Europe. Policy Research Working Paper;No. 2675. © http://hdl.handle.net/10986/19553 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Publication Gender Gaps in the Performance of Small Firms: Evidence from Urban Peru(Washington, DC: World Bank, 2025-09-23)This paper estimates the gender gap in the performance of firms in Peru using representative data on both formal and informal firms. On average, informal female-led firms have lower sales, labor productivity, and profits compared to their male-led counterparts, with differences more pronounced when controlling for observable determinants of firm performance. However, gender gaps are only significant at the bottom of the performance distribution of informal firms, and these gaps disappear at the top of the distribution of informal firms and for formal firms. Possible explanations for the performance gaps at the bottom of the distribution include the higher likelihood of small, female-led firms being home-based, which is linked to lower profits, and their concentration in less profitable sectors. The paper provides suggestive evidence that household responsibilities play a key role in explaining the gender gap in firm performance among informal firms. Therefore, policies that promote access to care services or foster a more equal distribution of household activities may reduce gender productivity gaps and allow for a more efficient allocation of resources.Publication Global Poverty Revisited Using 2021 PPPs and New Data on Consumption(Washington, DC: World Bank, 2025-06-05)Recent improvements in survey methodologies have increased measured consumption in many low- and lower-middle-income countries that now collect a more comprehensive measure of household consumption. Faced with such methodological changes, countries have frequently revised upward their national poverty lines to make them appropriate for the new measures of consumption. This in turn affects the World Bank’s global poverty lines when they are periodically revised. The international poverty line, which is based on the typical poverty line in low-income countries, increases by around 40 percent to $3.00 when the more recent national poverty lines as well as the 2021 purchasing power parities are incorporated. The net impact of the changes in international prices, the poverty line, and new survey data (including new data for India) is an increase in global extreme poverty by some 125 million people in 2022, and a significant shift of poverty away from South Asia and toward Sub-Saharan Africa. The changes at higher poverty lines, which are more relevant to middle-income countries, are mixed.Publication Intergenerational Income Mobility around the World(Washington, DC: World Bank, 2025-07-09)This paper introduces a new global database with estimates of intergenerational income mobility for 87 countries, covering 84 percent of the world’s population. This marks a notable expansion of the cross-country evidence base on income mobility, particularly among low- and middle-income countries. The estimates indicate that the negative association between income mobility and inequality (known as the Great Gatsby Curve) continues to hold across this wider range of countries. The database also reveals a positive association between income mobility and national income per capita, suggesting that countries achieve higher levels of intergenerational mobility as they grow richer.Publication The Macroeconomic Implications of Climate Change Impacts and Adaptation Options(Washington, DC: World Bank, 2025-05-29)Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.Publication The Impact of Atlantic Hurricanes on Business Activity(Washington, DC: World Bank, 2025-09-22)This paper quantifies the short-run economic impact of 21 Atlantic hurricanes on U.S. local business activity from 2017 to 2024 using anonymized Mastercard transaction data aggregated by ZIP code. On average, hurricanes reduce merchant sales by 12.4 percent during the preparation, impact, and recovery phases—an estimated US$1.38 billion in lost revenue per storm. Substitution in spending across nearby areas or large online platforms is limited, indicating widespread local consumption declines. Economic disruption varies more by industry than storm intensity, with independent stores hit harder than chains. Local businesses with larger online presence face smaller, shorter sales declines, showing greater resilience.
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Road User Charges : Current Practice and Perspectives in Central and Eastern Europe(2008-11-01)This paper covers the most commonly used means to charge road users, including fuel taxes, vehicle taxes, vignettes and tolls. It presents a brief survey of road user charging systems in selected European countries and a more detailed overview of current status and perspectives of road user charges in Poland. Consideration is also given to private financing of roads through different forms of public-private partnerships (PPP), including a review of potential applications of the World Bank toolkit for PPP in highways as an instrument to help decision makers and practitioners to define the best PPP approach for a specific country.Publication Bosnia and Herzegovina - The Road to Europe : Annex 1. Primary and Secondary Roads - A Foundation for Private Sector Led Growth(Washington, DC, 2010-05)This report highlights deficiencies and indicates priorities for a prospective national transport strategy and action plan for further consideration by key stakeholders. The overall objective should be the development of a transport system, and an institutional framework, that facilitates rather than constrains, economic development in Bosnia and Herzegovina. A strong transport system contributes to economic growth by reducing the economic distance to markets by expanding opportunities for trade, by improving the competitiveness of national locations for production and distribution, and by facilitating mobility for a country s citizens; while minimizing the social and environmental costs of the transport sector. The report concludes by recommending actions that aim to improve the institutional framework, improve the sustainability of the transport sector, facilitate broad based economic growth, and mitigate the social and environmental detriments associated with transport. Specific policy recommendations are presented to accomplish these conclusions.Publication Private Participation in the Road Sector in Brazil : Recent Evolution and Next Steps(World Bank, Washington, DC, 2010-03)Today, Brazil has the second longest highway network under private concessions in the world. This paper analyzes Brazil's experience under the two first phases of the federal road concession program, and highlights some of the program's strengths and areas for further development. Despite the unfolding world financial and economic crisis, the potential for further private participation in the sector appears very good. This paper essentially argues that it may be time for Brazil to revamp its current models for private participation in the sector, which may soon reach their limit in terms of being able to meet efficiently the needs of a growing economy. In summary, Brazil could: 1) diversify its toll road model to allow for more innovative public-private partnership structures; 2) update its toll regulatory and contractual framework to overcome some of the design problems that have led to relatively inefficient tolling; 3) consolidate the institutional framework for road concessions to give a stabilized basis for further developments; 4) develop a policy framework adapted to the current Brazilian environment, taking into account the need to ensure harmonized levels of service and tolls across the country; and 5) adapt the sector financing framework to the rising capacity of private markets.Publication The Long and Winding Path to Private Financing and Regulation of Toll Roads(World Bank, Washington, DC, 2000-06)Road transport has long been the dominant form of transport for freight and passenger movement throughout the world. Because most road projects require investments with long amortization periods and because many projects do not generate enough demand to become self-financing through some type of user fee or toll, the road sector remains in the hands of the public sector to a much greater extent than other transport activities. But governments throughout the world, including those of many poor African and South Asian countries, are commercializing their operations to cut costs, improve user orientation, and increase sector-specific revenue. There seems to be demand for toll roads in specific settings, but the problems met by many of this "first generation" of road concessions-from Mexico to Thailand-have given toll projects a bad reputation. Many mistakes were made, and tolling is obviously not the best solution for every road. Most of the alternatives aim at improving efficiency (lowering costs). But there are many ways of getting the private sector involved in toll roads, thus reducing public sector financing requirements for the sector. Understanding the context in which toll roads are viable is essential both for their initial success and for effective long-run regulation. The authors provide a broad overview of issues at stake from the viewpoint of both privatization teams and regulators responsible for supervising contractual commitments of private operators and the government, to each other and to users.Publication A Review of Institutional Arrangements for Road Asset Management : Lessons for the Developing World(World Bank, Washington, DC, 2010-04)The type of institutional arrangement for managing roads adopted by a country depends on the objectives and performance that it sets for its road networks. This paper reviews such arrangements for selected countries; China, Brazil, Slovenia, New Zealand, United Kingdom, and the Slovak Republic. These countries have adopted different approaches in several dimensions, such as decentralization, sources of financing, management structure, and modal responsibility. This paper reviews main factors affecting the efficiency of road agencies and describes the steps taken in creating a new institution, or transforming an existing one, and assesses the effort required to achieve such results. In all countries reviewed, the ministry responsible for the transport sector remains the authority responsible for the overall transport policy and for putting in place checks and balances for good governance and management of fiscal risk. The main aspects of institutional reforms that can contribute to increase the efficiency of road and transport agencies include: improved institutional structures, separation of the client and supplier functions, separation of client and supplier organizations, privatization of the supplier organizations, establishment of an executive agency or a commercialized (client) organization, user participation through oversight boards, improving management information systems, and seeking additional sources of financing.
Users also downloaded
Showing related downloaded files
Publication Argentina Country Climate and Development Report(World Bank, Washington, DC, 2022-11)The Argentina Country Climate and Development Report (CCDR) explores opportunities and identifies trade-offs for aligning Argentina’s growth and poverty reduction policies with its commitments on, and its ability to withstand, climate change. It assesses how the country can: reduce its vulnerability to climate shocks through targeted public and private investments and adequation of social protection. The report also shows how Argentina can seize the benefits of a global decarbonization path to sustain a more robust economic growth through further development of Argentina’s potential for renewable energy, energy efficiency actions, the lithium value chain, as well as climate-smart agriculture (and land use) options. Given Argentina’s context, this CCDR focuses on win-win policies and investments, which have large co-benefits or can contribute to raising the country’s growth while helping to adapt the economy, also considering how human capital actions can accompany a just transition.Publication Classroom Assessment to Support Foundational Literacy(Washington, DC: World Bank, 2025-03-21)This document focuses primarily on how classroom assessment activities can measure students’ literacy skills as they progress along a learning trajectory towards reading fluently and with comprehension by the end of primary school grades. The document addresses considerations regarding the design and implementation of early grade reading classroom assessment, provides examples of assessment activities from a variety of countries and contexts, and discusses the importance of incorporating classroom assessment practices into teacher training and professional development opportunities for teachers. The structure of the document is as follows. The first section presents definitions and addresses basic questions on classroom assessment. Section 2 covers the intersection between assessment and early grade reading by discussing how learning assessment can measure early grade reading skills following the reading learning trajectory. Section 3 compares some of the most common early grade literacy assessment tools with respect to the early grade reading skills and developmental phases. Section 4 of the document addresses teacher training considerations in developing, scoring, and using early grade reading assessment. Additional issues in assessing reading skills in the classroom and using assessment results to improve teaching and learning are reviewed in section 5. Throughout the document, country cases are presented to demonstrate how assessment activities can be implemented in the classroom in different contexts.Publication Lebanon Economic Monitor, Fall 2022(Washington, DC, 2022-11)The economy continues to contract, albeit at a somewhat slower pace. Public finances improved in 2021, but only because spending collapsed faster than revenue generation. Testament to the continued atrophy of Lebanon’s economy, the Lebanese Pound continues to depreciate sharply. The sharp deterioration in the currency continues to drive surging inflation, in triple digits since July 2020, impacting the poor and vulnerable the most. An unprecedented institutional vacuum will likely further delay any agreement on crisis resolution and much needed reforms; this includes prior actions as part of the April 2022 International Monetary Fund (IMF) staff-level agreement (SLA). Divergent views among key stakeholders on how to distribute the financial losses remains the main bottleneck for reaching an agreement on a comprehensive reform agenda. Lebanon needs to urgently adopt a domestic, equitable, and comprehensive solution that is predicated on: (i) addressing upfront the balance sheet impairments, (ii) restoring liquidity, and (iii) adhering to sound global practices of bail-in solutions based on a hierarchy of creditors (starting with banks’ shareholders) that protects small depositors.Publication The Journey Ahead(Washington, DC: World Bank, 2024-10-31)The Journey Ahead: Supporting Successful Migration in Europe and Central Asia provides an in-depth analysis of international migration in Europe and Central Asia (ECA) and the implications for policy making. By identifying challenges and opportunities associated with migration in the region, it aims to inform a more nuanced, evidencebased debate on the costs and benefits of cross-border mobility. Using data-driven insights and new analysis, the report shows that migration has been an engine of prosperity and has helped address some of ECA’s demographic and socioeconomic disparities. Yet, migration’s full economic potential remains untapped. The report identifies multiple barriers keeping migration from achieving its full potential. Crucially, it argues that policies in both origin and destination countries can help maximize the development impacts of migration and effectively manage the economic, social, and political costs. Drawing from a wide range of literature, country experiences, and novel analysis, The Journey Ahead presents actionable policy options to enhance the benefits of migration for destination and origin countries and migrants themselves. Some measures can be taken unilaterally by countries, whereas others require close bilateral or regional coordination. The recommendations are tailored to different types of migration— forced displacement as well as high-skilled and low-skilled economic migration—and from the perspectives of both sending and receiving countries. This report serves as a comprehensive resource for governments, development partners, and other stakeholders throughout Europe and Central Asia, where the richness and diversity of migration experiences provide valuable insights for policy makers in other regions of the world.Publication World Development Report 2006(Washington, DC, 2005)This year’s Word Development Report (WDR), the twenty-eighth, looks at the role of equity in the development process. It defines equity in terms of two basic principles. The first is equal opportunities: that a person’s chances in life should be determined by his or her talents and efforts, rather than by pre-determined circumstances such as race, gender, social or family background. The second principle is the avoidance of extreme deprivation in outcomes, particularly in health, education and consumption levels. This principle thus includes the objective of poverty reduction. The report’s main message is that, in the long run, the pursuit of equity and the pursuit of economic prosperity are complementary. In addition to detailed chapters exploring these and related issues, the Report contains selected data from the World Development Indicators 2005‹an appendix of economic and social data for over 200 countries. This Report offers practical insights for policymakers, executives, scholars, and all those with an interest in economic development.