When the new Eu25 billion ($30 billion) 2005-2009 Portuguese infrastructure investment programme – Programa de Investimentos en Infrastructuras Prioritarias (PIIP) – was announced in June it was the first sign that the political stasis that has afflicted the Portuguese public-private-partnership (PPP) market, along with the economy, for the past four years is over.
Portugal needs PPP – no argument – if it wants the infrastructure to fuel much-needed economic growth. In August the EU gave Portugal three years to cut its deficit – which stands at 6.2% of GDP, more than double the 3% limit imposed by the EU's Stability and Growth Pact – and six months to come up with measures that would cut the deficit by the equivalent of 1.5% of GDP in 2006 and by a further 0.75% in 2007 and 2008.
The socialist government of Jose Socrates has responded with a budget for 2006 that slashes state spending next year (over 50% of the PIIP plan is expected to come from the private sector) by around Eu2 billion and will, if all goes to plan, trim the public deficit down to 4.8% of GDP in 2006.
But the new urgency in the Portuguese approach to PPP goes deeper than the PIIP and fiscal reform – there is a fundamental change in methodology brewing in government.
A change in PPP methodology
Significantly, the Portuguese government is looking at ways to reform the PPP tendering process and has made a commitment to shorten the period from request for proposals (RFP) to awarding –...
Thank you for printing this article from IJGlobal.
As the leading online publication serving the infrastructure investment market, IJGlobal is read daily by decision-makers within investment banks, international law firms, advisory firms, institutional investors and governments.
If you have been given this article by a subscriber, you can contact us through www.ijglobal.com/signup, or call our London office on +44 (0)20 7779 8870 to discuss our subscription options.
Thank you for your interest in using My IJGlobal.
As your firm uses IP recognition, you will need to sign in with your own unique login and password. If you do not have your own login details, please click here to register.
Alternatively, contact the IJGlobal Helpdesk on +44 (0)20 7779 8870 or email Helpdesk on email@example.com.