Browsing by Author "Arango Botero, Esteban"
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- Financing infrastruture projects using PPPs : the case of the 4th generation of highways in ColombiaPublication . Arango Botero, Esteban; Reis, Ricardo César Ribeiro Ventura Ferreira; Sarmento, JoaquimPublic-private partnerships (PPPs) have become in a well-know model that is use around the globe for infrastructure development, especially for highways construction and operation. As the private sector becomes responsible for the availability and quality of the infrastructure, there are efficiencies and innovations expected that make the PPP model more suitable than traditional public procurement. Besides, PPPs are expected to evoke performance-based contracting, more solid regulation and are a financing alternative when there are budgetary fiscal constrains. The 4th Generation of highways is an ambitious PPP program developed by the Colombian government to build more than 30 highways in the country in the next 5 years, which contemplates investment of more than EUR 20 billion. This paper aims to analyze in detail the 4G program experience, to assess strengths and weaknesses of the Colombian model that could become on learning points for future PPP projects on emerging markets. Several findings on the lack of financing capacity by private partners, barriers on lending and immaturity of the institutional market, summed up to particular risks and lack of a more accurate planning, have made evident the dependency on public resources. Then, the question arise about the convenience of the PPP model and consideration of other alternatives for the development of the roads that are heavily required to boost the competitiveness of this emerging country.