Brazil needs to invest more than $200 billion in infrastructure. The federal and state governments hope to achieve this through Public-Private Partnerships.
|Will PPPs become Brazil's
blueprint for infrastructure finance?
Brazilian officials recognize that the current level of
private-sector investment must be increased substantially if
the country's infrastructure needs are to be met. To that end,
the federal and state governments are in the final stages of
establishing a legal and contractual framework for
Public-Private Partnership (PPP) schemes.
Since the inception of the UK's PPP (and the related Private
Finance Initiative) in 1992, more than 600 projects have been
executed. The UK system, a global benchmark, identifies three
issues that must be addressed if the Brazilian program is to be
successful. First, objectives of the private sector must be
aligned with the priorities of the federal and state
governments. Further, private-sector investors must be ensured
an appropriate risk transfer to achieve value for money, within
a financeable structure. And finally, the scheme must make
certain that private sector skills, expertise and...
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