PPP/PFI Outlook 2013

2012 was a difficult year for PPP participants, even in comparison to the dire market conditions of four years ago, as the global PPP market dipped following a deteriorating economic environment across its active markets. Constrained public finances, lack of long-term debt financing, and delays in procurement undermined the value of PPP investments and resulted in a fall in the number of deals that managed to secure funding. Despite more countries closing deals last year than in 2011, 25 in total, there was no concomitant rise in the overall value of the PPP market; the growth in PPP markets in some countries was offset by a decline in others. Although 2012 saw 11 new entrants to the PPP sector, 9 previously active countries failed to close any deals at all, and furthermore those new entrants, with the exception of the US, Turkey, New Zealand and the Netherlands, mainly closed single transactions. For the first time France overtook the UK as the number one global PPP market in terms of the combined value of projects: excluding Transport deals, Australia secured top spot for social and water infrastructure PPPs in terms of value, whilst France recorded the highest volume of non-Transport PPP deals.

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