Infrastructure and Project Financing in Italy: The (Possible) Role of the Regulation

46 Pages Posted: 16 May 2010

Date Written: November 13, 2009

Abstract

There has been a significant increase in project financing in the public sector in Europe in the past decade, benefiting the implementation of infrastructure projects. In Italy, project financing is still much more limited than in such countries as Spain and the UK: the projects funded are smaller and the sectors involved are less appropriate. Based on the economic literature, European initiatives and international comparisons, the paper examines the aspects of the regulations that could encourage the appropriate use of project financing and considers the problems with the Italian regulations, proposing some corrective measures. The main limitations involve: i) uncertainties over the allocation of administrative and regulatory risks; ii) poor procedures for selecting the private contractors; iii) relative lack of attention to the contract terms; and iv) inadequate safeguards to ensure the bankability of the projects.

Keywords: infrastructure financing, project financing, regulation, risk allocation

JEL Classification: K23, L51, L90

Suggested Citation

Giorgiantonio, Cristina and Giovanniello, Valentina, Infrastructure and Project Financing in Italy: The (Possible) Role of the Regulation (November 13, 2009). Bank of Italy Occasional Paper No. 56, Available at SSRN: https://ssrn.com/abstract=1606248 or http://dx.doi.org/10.2139/ssrn.1606248

Cristina Giorgiantonio (Contact Author)

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

Valentina Giovanniello

Bank of Italy ( email )

Via Nazionale 91
Rome, 00184
Italy

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