Finance of Transport Infrastructure

 SCS122

GPI, AUEB
Available funding from traditional sources falls short of the investment needs of the EU transport sector. The necessary investments in TEN infrastructure are expected to reach €300 billion by 2013 and a significant financial gap in public resources is anticipated to appear. Under these conditions, one way is to mobilise private investment in infrastructure projects or investigate mechanisms for generating more resources from off-budget sources. 

The main traditional sources of funding for transport infrastructure include allocations from national and EU budgets, domestic and foreign loans, and official development assistance such as structural and cohesion funds. In recent years, governments find it very difficult to meet these funding needs and try to diversify the sources of finance. The public-private partnerships have played an important role in this process as well as capital markets’ financial instruments.  
 
The present section intends to provide an overview of recent trends in the financing of EU transport infrastructure and the innovative financial arrangements that have emerged. For instance, TEN-T programme in cooperation with the European Investment Bank’s financial instruments, EBRD’s financing and co-financing, and the EU Structural&Cohesion funds for transport infrastructure. All these existing public and private capital for funding infrastructure illustrate the variety of financial tools that can be applied for maintaining competitive transport system.