PPIAF

PPIAF Highlights

PPIAF Annual Meeting
Co-hosted by the African Development Bank and the Infrastructure Consortium for Africa, this year’s PPIAF annual meeting was held in Tunis, Tunisia. Observers invited to the meeting included the European Investment Bank, the Aga Kahn foundation, the Water and Sanitation program and the International Finance Corporation’s sub-national finance department. As part of the program council meeting, presentations focused on meeting Africa’s needs through new sources of infrastructure finance, including an overview and discussion of the African Infrastructure Country Diagnostic, the Building Bridges report, and a municipal finance survey -- all knowledge products supported by PPIAF.

PPI Trends

Transport Continues to drive PPI Growth in 2007 
Private activity in transport infrastructure continued to receive high levels of investment commitments in 2005-07. Private activity was more evenly distributed across regions and income groups than during the 1990s. This increase in investment has been achieved through increased public-sector cost sharing in projects with private-sector participation.  Read more »

Number of Water Projects Reaches New Peak in 2007
In 2007, 12 low- and middle-income countries implemented at least 62 water projects with private participation. These projects accounted for more than $3.2 billion in investment commitments. Read more »

Note: The PPI Database will be down for maintenance for two weeks.
For more trends, go the Private Participation in Infrastructure (PPI) Project Database. Funded by PPIAF and the World Bank, this site has data on more than 3,800 projects in 143 low- and middle-income countries.

Back to Top

New PPIAF Gridlines and Publications

Gridlines

Recent Trends in Private Activity in Infrastructure: What the Shift Away From Risk Means for Policy
In 2006, private participation in infrastructure continued its recovery for the third consecutive year from the steep downturn of the late 1990s.  But investment also became concentrated in subsectors that private investors consider to be less risky.

Does the Private Sector Deliver on Its Promises?  Evidence from a Global Study in Water & Electricity
Is private operation better than public when it comes to utilities? A recent global study funded by the World Bank and PPIAF examines the effect of private sector participation in electricity distribution and water and sanitation services.

Are Brownfield Concessions Poised for a Comeback?  New Signs of Life After a Decade in Decline
Once expected to be the signature contract of private participation in infrastructure and for a time its fastest growing form, the brownfield concession was hit hard by the Asian crisis and has never recovered.

Protecting Electricity Retailers Against Price Volatility:  The Electricity Tariff Equalization Fund in New South Wales
New South Wales introduced full retail competition for electricity in 2002, allowing customers to switch to competitive suppliers. Read more about the transitional mechanism the government used to protect small electricity users against price volatility.

Worldwide Trends in Private Participation in Roads: Growing Activity, Growing Government Support
Private participation in roads revived strongly in developing countries in 2005-06.  The activity was concentrated in greenfield projects in Asia and Latin America.  The main reason for the revival has been the support needed to attract the private sector.

The Role of Developing Country Firms in Infrastructure: New Data Confirm the Emergence of a New Class of Investor (Updated with 2005 and 2006 Data)
Developing country investors continue to provide a major source of finance for infrastructure projects with private participation.  New data confirms that these investors account for more finance than investors from developed countries, in the South Asia and East Asia and the Pacific regions, and in the transport sector across developing regions.

Back to Top

Publications

Building Bridges: China’s Growing Role as Infrastructure Financier for Africa
China, India, and a few Middle Eastern Gulf nations are providing a record amount of financing for infrastructure projects across Sub-Saharan Africa. Investment commitments in Africa by these emerging financiers jumped from less than $1 billion per year before 2004 to $8 billion in 2006 and $5 billion in 2007, signaling a growing trend in cooperation among developing countries. Read more.

An Empirical Assessment of Private Sector Participation in Electricity and Water Distribution in Developing and Transition Economies
To evaluate the impact of private sector participation on firm performance in electricity distribution and water and sanitation services, this study analyzes a panel of 301 utilities with PSP and 926 utilities without PSP in 71 developing and transition economies.  Read more, or see the Gridlines summarizing the findings. Read more.

Back to Top

New Activity Highlights

PPIAF approved 97 activities in fiscal year 2008. Click to view a list of those activities from the third or fourth quarter. Or, to view descriptions of activities from the last two years, click here. 

Africa looks to develop fiber-optic backbone
The study will provide the technical consultancy needed to build a telecommunications backbone network for central Africa, following up on an earlier feasibility study funded by PPIAF. Currently, most of Africa relies on slow and expensive satellite uplinks for connection to the global telecommunications network. But a new fiber-optic backbone would provide access to low-cost, high-speed telecommunications services. In addition to the study, the new activity will fund workshops with government officials and organize an expert commission that will include officials from the region.

A Strategy for Transport Investment in East and Southern Africa
A new study will develop a PPP investment strategy to improve service, reduce costs and increase efficiency along the major transportation corridors in East and Southern Africa. Africa lags behind the rest of the world in terms of transport times and costs along key export corridors – a major impediment to development. The study will look at opportunities for enhanced private participation in rail, road, port and airport transportation infrastructure, and examine opportunities for intermodal linkages.

Maharashtra Develops Post-Contract Management Strategy
Franchising of electricity distribution operations is an important new public-private partnership model for the sector in India. But effective management and monitoring of the franchises is critical to ensure their long-term sustainability. This PPIAF activity will help the Maharashtra State Electricity Distribution Company set up a franchise management cell to strengthening the company’s institutional capacity for managing distribution public-private partnerships.

Brazil Develops Waste Management Framework
This new grant will help remove barriers to private sector participation, as a way to gain more sustainable, transparent and efficient operation of municipal solid waste services. One of the main financiers of solid waste services in Brazil, The Caixa Economica Federal (CAIXA), sought PPIAF support to develop a framework for private participation that includes consideration of local variables, consultation with stakeholders and the incorporation of new risk mitigation models.

Mozambique Looks to Alleviate Power Bottlenecks
A north-south transmission backbone promises to help alleviate bottlenecks through a pioneering form of build-own-operate-transfer public-private partnership. This project will be the first use of private investment to build the transmission backbone of a national grid in Africa. Combined with a number of generation public-private partnerships in the region, the backbone will form the basis of the first private sector-led “generation hub” on the continent.

Back to Top

Sub-National Technical Assistance Program

Peru Turns to Private Market for Financing
This activity will improve the capacity of Peruvian sub-national governments to access financing from commercial banks and capital markets. In addition to helping sub-national governments obtain a credit rating, consultants will recommend steps to improve their capacity to design, finance and manage infrastructure projects.

Survey Looks at Municipal Finance in Developing Countries
A new paper will survey market-based lending by private sector entities to finance sub-national infrastructure in the developing world.

Philippines Seeks Credit Ratings for Local Governments
The government of the Philippines is looking at ways to reform its framework for local government financing. This new activity will provide credit ratings to a group of Philippine municipalities, and fund a workshop on the role of credit ratings in local government financing. The activity will also help the central government develop a strategy for regulating the borrowing activities of local governments.