# **2.1. Developed economies**

Two-thirds of the private projects credited to developed countries accrue to 5 countries: US (122 projects), Spain (66), UK (64), Australia (46) and Canada (37). Adding Portugal (22), Germany (19), Ireland (16) and Greece (14) covers 90% of the projects during the period 1985-2003. In terms of commitments, the ranking is somewhat different. The UK enjoys 27% of the commitments, the US 17%, Japan 8%, Italy and Spain 7%, Canada 6% and Australia 5%. The sectoral composition of the projects reveals nicely the subsectoral demand. Toll roads and rail projects attract the most attention reflecting the increased demand for passenger mobility in developed countries and in Europe due to the increased integration of the continent. Seaports do not seem to need new investments, consistent with the wide perception that there may be an excess capacity in the sector and that many of the ports continue to be maintained for political or strategic reasons. Airport projects are heavily concentrated in the United States, Australia and the UK where the size of the first two countries and the insular character of the third one ensure that the increased demand for passenger mobility is not monopolized by ground transportation.

The statistics also reflect the levels and commitments of the governments of the top three countries to private sector participation in the transport sector. The US has indeed a long tradition which for the last fifteen years or so has been actively followed by the UK and Australia. More recently, following the liberalization stimulus of the European Commission many countries in continental Europe are actively involving the private sector in the transport sector. In particular, Portugal, Greece and Spain have experienced a significant increase in the quantity of projects planned, often with the financing of the regional development funds of the EEC.

# **2.2. Developing economies**

The commitments published by Public Works are known to be overestimates of the actual numbers but also to sometimes fail to account for new projects in some regions and sectors in developing countries. The World Bank has been publishing for some time now more refined estimates of these commitment figures trying to separate wishful-thinking by sponsors from serious commitments. This database covers actual deals –rather than planned projects as in the case of the Public Works database- on projects that have reached financial closure in water, electricity, natural gas, telecommunications and transport. It deals exclusively with projects in which the private company assumes operating risk during the operating period or assumes development and operating risk during the contract period. Investments and privatization revenues are recorded on a commitment basis in the year of financial closure. Actual disbursements are not tracked.

This effort results in a significant drop in the estimates to US$135 billion between 1990 and 2001, implying that the total commitments to transport in the world were at most US$515 billion rather than US$684 billion. For developing countries, this implies an average project size of US$204 millions, or less than 50% of the estimate provided in Table 1. Considering that the world counts 155 countries defined as developing, the average commitment per country would be about US$80 million dollars per year.<sup>6</sup> The average project size implies that at least half of the countries do not benefit from any project. The privatization experience has in fact been even more concentrated than expected. Indeed, China, Brazil, Argentina, Mexico and Malaysia concentrated most of the investment during the period, although with strong fluctuations over time. Up to the Tequila Crisis, these 6. This kind of back-of-the-envelope estimation shows why the share of financing of transport infrastructure by the private sector is likely to be much lower than the 20% estimated by DFIF (2002) for the whole of the infrastructure sector.

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