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INFRASTRUCTURE & RESOURCE

Development
in the early 1980s During the 1980s, as a number of governments, as
well as international lending institutions, became in-
The convergence of a number of factors by the creasingly interested in promoting the development
early 1980s led to the search for alternative ways to of the private sector, a consensus developed. It
develop and fi nance infrastructure projects around supported tapping in the energy and initiative of
the world. These factors include: the private sector, and the discipline imposed by
• Continued population and economic growth its profi t motive, to enhance the effi ciency and pro-
meant that the need for additional infrastruc- ductivity of what had previously been considered
ture – roads, power plants, water-treatment public-sector services.
plants – continued to grow;
• The debt crisis meant that many countries had It is now increasingly recognised that the priva-
less borrowing capacity and fewer budgetary te sector can play a dynamic role in accelerating
resources to fi nance badly needed projects; growth and development. Many countries are en-
the debt burden required them to adopt an couraging direct private-sector involvement and
austere approach when planning fi scal spen- making strong efforts to attract new money throu-
ding, compelling them to look to the private gh new project fi nancing techniques.
sector for investors for projects which in the Such encouragement is not borne solely out of the
past would have been constructed and ope- need for additional fi nancing, but it has been re-
rated in the public sector; cognised that private-sector involvement can bring
• Major international contracting fi rms which in with it the ability to implement projects in a shorter
the mid-1970s had been kept busy, particu- time, the expectation of more effi cient operation,
larly in the oil-rich Middle East, were, by the better management and higher technical capability
early 1980s, facing a signifi cant downturn in and, in some cases, the introduction of an element
business and looking for creative ways to pro- of competition into monopolistic structures.
mote additional projects;
• Competition for global markets among major Project Finance is being introduced in both develo-
equipment suppliers and operators (particu- ped and developing countries as an alternative way
larly in the power and transportation industries) to fi nance infrastructure and industrial projects,
led them to become promoters of projects to both small and large. The concept is being used
enable them to sell their products or services; in transportation (tolled roads, tolled estuarial cros-
• Outright privatisation was not acceptable in sings and railways); energy (private power stations,
some countries or appropriate in some sec- waste-to-energy plants and gas-distribution pipe-
tors for political or strategic reasons and go- lines); sewage and water-treatment plants; health
vernments were reluctant to relinquish total care (construction and operation of new hospital
control of what may be regarded as state as- buildings and clinical waste disposal plants); edu-
sets. cation (provision of student accommodation and

76 76 Impiantistica Italiana - Marzo-Aprile 2022