Public-Private Partnerships: An Effective Model For Project Financing

Article by Ron Vered and Brigitta Zibenberg

For many years, project finance has been, and remains, the preferred form of financing for large-scale industrial and infrastructure projects worldwide. The availability of infrastructure facilities is imperative for the overall development and economic growth of any country, especially of emerging economies. Therefore, the long-term need for infrastructure financing in both developing and industrialised countries is very high and of pivotal importance. However, almost every country faces the problem that its actual infrastructure requirements are far in excess of the funding allocated for this purpose. The recognition of this financial deficit has led to a nearly universal acknowledgment that the private sector should play a greater role in the financing of infrastructure in partnership with the public sector.