by Agnes a Paris
Mon Jan 23rd, 2006 at 03:46:48 AM EST
Promoted by Colman
See also the first installment on Central and Eastern Europe in the diary section.
The approach to transportation infrastructure finance in Europe, this diary focusing on highways, is quite different from country to country. Among the discriminating factors, ownership (public or private) of the motorway operators, as well as the way users are made to contribute to refunding the construction capex and pay for the service.
One key feature is that PPP has been embraced by most European countries as the one best way to finance the transportation infrastructure needs. Herebelow the situation in some European countries as an open door to the debate.
Plus, as an up-date, a specific focus on Spain.
europe
politics
At both state and local level, Spain continues to represent one of the most active proponents of toll road concessions. The promotion of enhanced accessibility and regional development through shadow toll road concessions clearly remains a key objective for many of the country's autonomous regional communities.
In Galicia, the regional government is promoting five shadow toll roads. Two of these concessions were awarded in mid 2005: the 100 million ($121 million) Autovia Santiago-Brion; and the 40 million Autovia de Salnes. Valencia has announced up to nine new shadow-toll road projects as part of its regional infrastructure plan. In June, two of these, CV-35 and CV-50, were awarded to a consortium led by large Spanish concessionaire Sacyr under a 450 million 35-year concession.
In 2005, the regional government of Catalonia announced four design, build, finance, and operate (BBFO) shadow toll road concessions in a move away from user-paid toll constructs. Bids were received in September for the first of these roads, the 63 million, 27 kilometer Macanet-Platja d'Aro motorway, with others valued between 50 million and 220 million scheduled to follow in late 2005 and early 2006.
Other regional developments include: the submission of bids for Zaragoza's first shadow toll road project, worth 200 million in Aragon, northeast Spain, in September 2005; a 200 million shadow toll road package in Castilla y Leon, also to the north; and the award of the AS-18 shadow toll road concession, worth 200 million, in Asturias to Sacyr.
Closer to Madrid, but staying at the local-government level, a 400 million bridge facility for Madrid's M-30 ring road closed in mid 2005. This is Spain's biggest-ever PPP financing. Major Spanish concessionaire Cintra was awarded a 30-year concession for the 80 million M-203 user-paid toll road in July 2005.
Other European Countries
In Germany, the process is well under way as a bunch of A-modell motorway projects are currently at BAFO stage : Bucholz-Bremmer Kreuz ; Baden Baden to Offenburg ; Bubesheim to Augsburg.
In Austria, the Ostregion scheme is a programme of PPP planned road concessions which will form a network of highways to the north, east and south of Vienna, as well as between Vienna and the Czech border.
The roads are expected to enhance the Gdansk-Brno/Bratislava-Vienna corridor, forming part of the Trans European network. Total construction costs for the whole programme will be around 3 Bio €. The first package is currently in tender, and the preferred bidder will be announced in March 2006. There should be a vignette system, ie yearly charge per vehicle no matter what road you take. But no talk of real toll highways.
In Ireland , the NDP (National Development Plan) was published in 1999 with the key target to improve Ireland's physical infrastructure, particularly the road national network.
In Dec. 2003, the Ministry of Finance announced a 5-year multi-annual allocation to the NRA (National Roads Authority) of approx. 7 Bio € and the NDP has confirmed that a significant portion of the proposed investment will be delivered through a PPP programme, with a min. indicative target for private sector investment in PPP projects of 2.35 Bio €.
It is clear from the NDP that the roads sector is a PPP priority. The M3 Clonee to Kells project will stretch on almost 100 km and was won last July by the Spanish Cintra-led consortium on the basis of best priced bid. Other projects, including N7 Limerick Southern ring connecting Limerick to the Dublin road, are currently in tender.
In France, we have yet another situation : it would be unthinkable that users do not pay tolls on all major motorways, even if the caprex costs have long been recouped.
With the currently on-going privatisation process of highway operators, the State is successfully having the private sector fund the budget deficit. Both the State and banks are rubbing their hands. The latter are bound to make big money by extending loans to potential bidders lacking big pockets.
Among motorway operators still remaining partly public-owned : ASF (Autoroutes du Sud de la France) and Cofiroute have already a strong private flavour with Vinci owning a significant chunk in both. In the privatisation process, Eiffage teamed up with Australia's Macquarie to win the bid for APRR (Autoroutes Paris Rhin Rhône).
The result of all this is that transportation infrastructures are bound to be not only private-owned, but may also fall into the hands of foreign companies. Local or foreign, private companies have an ROE constrain and shareholders to satisfy, does this leave much room for the concept of public service ?
