Best Practices in PPP Financing Latin America - e-Institute - World ...

Best practices in Public-Private Partnerships financing in Latin America
Table N.1
Private
Participation in
Infrastructure
PPI Percentage
of GDP
2005 2006 2007 2008 2009
Argentina 0,5% 1,5% 0,9% 0,8% 0,5%
Brazil 1,2% 1,1% 1,4% 1,9% 2,5%
Chile 0,8% 0,3% 0,6% 0,4% 1,0%
Colombia 0,6% 1,9% 1,0% 1,2% 0,5%
Mexico 0,6% 0,7% 1,0% 0,5% 0,5%
Peru 1,0% 1,6% 1,9% 1,2% 1,4%
Rest of LAC 0,7% 0,9% 0,9% 0,6% 0,4%
PPI: Private Participation in Infrastructure
Prepared by: Schwartz - Source: PPI Database, The World Bank (2011).
high- and low-risk countries in LAC, which is now increasing.
This risk level directly affects infrastructure investment
decisions.
During the 90s, the participation of the private sector in
public services was mainly achieved through privatizations.
This situation changed in the 2000-2009 period, when 80%
of private sector investments in the LAC region were made
through Concessions and “Greenfield” projects. For the year
2009, new investments were around US$ 30 billion, and were
concentrated by more than 70% in “Greenfield” projects.
Concerning the debt-equity ratio, Schwartz mentioned that
there is a significant change in this structure. Up to 2005,
investments were mainly financed through bonds and loans;
however, after the crisis of 2008, projects began to be
financed with more equity contributions. The total equityinvestment
ratio between pre-crisis, crisis and post-crisis
(2008-2010), increased from 18% to 28% the total investment
level. Financing through loans and bonds decreased from 79%
to 64%. In this way, investment with high leverage levels was
reduced after the crisis.
However, before the crisis, investments through PPP programs
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