Why Infrastructure Financing Facilities Often Fall Short of Their Objectives
To encourage the private funding and provision of infrastructure services, governments have used specialized financing facilities to offer financial support to investors, often in the form of grants, soft loans, or guarantees. The authors present case studies of infrastructure financing facilities in various stages of development in Colombia, India, and Pakistan. They also present case studies of government-sponsored financing facilities (not of infrastructure) in Argentina, and Moldova. They find that these facilities have often fallen short of their objectives for two main reasons. First, the environment was not conducive to private participation in infrastructure because of poor sector policies, an unstable macroeconomic environment, and inadequate financial sector policies, among other reasons. Second, the facility was faulty in design - in terms of sectors targeted, pricing of instruments, and consistency of objectives, and instruments.
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Bibliographic Details
| Main Authors: |
Klingebiel, Daniela,
Ruster, Jeff |
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| Language: | en_US |
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| Published: |
World Bank, Washington, DC
2000-06
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| Subjects: | ADB,
airports,
bonds,
capital flows,
capital market,
capital markets,
cash flow,
collateral,
commercial banks,
conflict of interests,
cost of capital,
credit rating,
decision making,
decision making process,
demonstration effects,
electricity,
emerging market economies,
emerging markets,
financial closure,
financial crises,
financial institution,
financial institutions,
financial markets,
financial sector,
financial support,
fiscal,
government budgets,
government guarantees,
government intervention,
government policies,
government resources,
housing,
insolvency,
institutional arrangements,
institutional capacity,
institutional framework,
institutional investors,
insurance,
interest rates,
investment banks,
legal framework,
legal structure,
liquidity,
long-term capital,
macroeconomic conditions,
mutual funds,
natural monopolies,
political risk,
political risks,
private ownership,
private sector,
private sector involvement,
privatization,
project finance,
property rights,
provision of infrastructure,
public agencies,
public finances,
public funds,
public sector,
public support,
rating agencies,
regulatory framework,
regulatory regimes,
risk profile,
roads,
securities,
state-owned enterprises,
subordinated debt,
tax,
tax incentives,
telecommunications,
term bonds,
transaction costs,
transparency,
utilities,
infrastructure financing,
financial instruments,
case studies,
developmental stages,
private sector participation,
policy framework,
macroeconomic context,
financial policy,
pricing schemes,
design criteria, |
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| Online Access: | http://hdl.handle.net/10986/21479
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