Assessment of the Impact of the Crisis on New PPI Projects : Update Five
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...
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| Format: | Brief |
| Language: | English |
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Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2010/02/11893582/assessment-impact-crisis-new-ppi-projects-update-five http://hdl.handle.net/10986/10939 |
| Summary: | 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. |
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