EIB Papers Volume 13. n°1/2008 - European Investment Bank

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The proxies are subject to caveats. 38 Volume13 N°1 2008 EIB PAPERS In practice, there are only a few countries where these relationships hold exactly. Lithuania comes closest, and there is a reasonable match in Sweden and Finland. There are some striking mismatches for a number of countries – e.g., government investment in “Economic Affairs” falling well short of our proxies for government transport investment in some cases. In addition, the last proxy derived by subtracting Structural Business Statistics data from national accounts data varies much more between countries than any of the other indicators considered, sometimes even turning negative, suggesting that the caveats listed in the Annex about the coverage and comparability of these datasets need to be taken seriously. Figure 8. Proxies for government transport investment, old member states (in percent of GDP, average 2000-05) 2.5 2.0 1.5 1.0 0.5 0 IE ES EL Source: Eurostat, ITF, own calculations IT BE SE FI Econ A�airs NA - SBS ITF (RRW) Government transport Figure 9. Proxies for government transport investment, new member states (in percent of GDP, average 2000-05) 3.0 2.5 2.0 1.5 1.0 0.5 0.0 SK CZ Source: Eurostat, ITF, own calculations SI LT MT Econ A�airs NA - SBS ITF (RRW) Government transport DK CY NL PL AT DE LV UK EE PT FR RO
Nevertheless, Figures 8 and 9 suggest some reasonably uncontroversial conclusions. First, transport accounts for roughly 80 percent of government investment in “Economic Affairs”. In the countries with hard data on government transport investment, that share is 88 percent. In both old and new member states, the ITF-based proxy is on average higher than government investment in “Economic Affairs” – suggesting the presence of corporate sector transport investment in the ITF data (notably in the railway sector). In countries where the ITF-based proxy is below government investment in “Economic Affairs”, it amounts to good 70 percent of the latter. The proxy derived by subtracting Structural Business Statistics data from national accounts data is on average quite close to government investment in “Economic Affairs” in both old and new member states. Considering only countries with this proxy below government investment in “Economic Affairs”, their average share is about 60 percent. Second, the level of government transport investment varies by country groups, with individual cohesion countries in the range 1 – 1.5 percent of GDP; other old member states at 0.5 – 1 percent of GDP, and new member states at 0.5 – 2 percent of GDP. In other words, the share of transport in overall government investment is on average and roughly speaking one-quarter in the old member states of the EU; one-third in the cohesion countries; and between one-quarter and one-third in the new member states. In a way to conclude this section, Box 4 seeks to put the estimated government transport investment into perspective and relate it to overall transport infrastructure investment in Europe. Linking back to the Venn diagram in Figure 1, Box 4 seeks to relate the intersection A to overall transport infrastructure investment. Box 4. Government investment in overall transport infrastructure investment A key conclusion of Section 3 is that transport accounts on average for some 80 percent of government investment in “Economic Affairs”. The aim of this box is to put that finding in a broader perspective by relating government transport investment to overall transport investment in EU member states. The task is obviously not straightforward and involves a few courageous assumptions and cutting some corners. The first assumption is that transport does indeed account for 80 percent of government investment in “Economic Affairs” in all EU countries. This assumption allows us to calculate country-specific estimates for government transport investment. Estimating overall transport investment in each country is more complicated. As mentioned in the main text, the national accounts statistics lump investment by the transport sector together with storage and communication investment. While the ITF data are well-focused on transport investment, they are for many countries a better proxy for government than overall transport investment. And the investment data in the Structural Business Statistics has the same drawback as all data that are based on a sectoral classification: They measure all investment, not just investment in transport infrastructure assets, by all companies who report transport sector as their main activity. To get an estimate of total economy investment in transport infrastructure, we adopt a different perspective and consider the production of, rather than investment in, transport infrastructure. The Structural Business Statistics report for each country the annual “production value” of a sample of companies whose main activity is in the construction of transport Transport accounts for one-quarter to one-third of overall government investment. EIB PAPERS Volume13 N°1 2008 39
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The modified approach suggests that
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Recent cost-of-funds estimates acco
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High GDP growth in the new member s
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Further productivity gains, includi
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Where fiscal positions were sound,
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Despite progress, infrastructure de
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Table 7. Infrastructure indicators
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EU funds provide additional resourc
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Various empirical studies confirm t
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In some new member states there is
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PPPs offer new opportunities to fin
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Strong legal and institutional fram
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Additional fiscal reporting - even
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Fiscal adjustment and reforms need
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EIB Papers • Volume 13 • No1
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