Assessment of the Impact of the Crisis on New PPI Projects : Update Six
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 200...
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| Format: | Brief |
| Language: | English |
| Published: |
Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2010/05/12817910/assessment-impact-crisis-new-ppi-projects-update-six http://hdl.handle.net/10986/10930 |
| Summary: | 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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