Long-Term Financing of infrastructure

On the occasion of the CICA Board-Council Meeting in Paris on the 17th of November 2014, it was decided to create a working group focusing on long-term financing of infrastructure. The interest for such a working group was confirmed at the CICA Board-Council meeting in Brasilia on the 27th of April 2015. It was also comforted by the interest generated by the roundtable on “Long-term financing market and its sources” organized during the International Meeting on Infrastructure and PPP hosted by CBIC, following the Board meeting in Brasilia.

Indeed, if it is unanimously recognized that the creation and the maintenance of public services infrastructures are essential to the establishment of a prosperous economy, the conditions to reach them are still very insufficiently satisfied. The absence of public capacity of financing is most of the time mentioned as the main reason to explain these deficiencies. The recourse to the techniques of Project Finance/PFI is presented as being the solution. However useful it is, this approach is totally insufficient to answer the immense world’s needs for infrastructures by 2030. They are estimated annually:

– Trade Infrastructure: investment financing thanks to users fee collection: USD 2, 6 trillion / year;
– Social Infrastructure: financing from States budget and from Public Aid: USD 1, 6 trillion / year.

The aim of this working group is to take into consideration the increasing recognition of the contribution of infrastructures to development, economic growth and employment.
The main goals of this CICA working group will be:

– To identify precisely the conditions required to trigger long term financing;
– To spread the solutions and the proposals of the construction industry;
– To undertake lobbying actions, at national and regional level, to assure the promotion of CICA and other professional organizations’ analysis and proposals.

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