The Serial Rise in Infrastructure Spending Shows that Australia Strategy is Working
November 28, 2017
Please find a link below to download S&P Global Ratings’ latest report.
- Immediately prior to the 2008 crisis, Australian infrastructure projects were plagued by ambitious forecasting, overly-aggressive financing structures, and high debt leverage ratios – with liquidity exhausted and financing by foreign banks falling by 50%, several high-profile projects defaulted;
- Thanks to an infrastructure strategy revision in 2011, however, investor confidence has returned. NSW’s economic growth has outpaced Australia’s – and the worldwide average – over the past two years;
- NSW’s strategy now embraces numerous financing tools, including: bundling; asset recycling; partial privatisation; and unsolicited proposal process, designed to encourage nongovernment sector participants to deliver projects. With the potential to be replicated elsewhere, these tools have accelerated project pipelines, attracted foreign investment and are considered best practice in risk allocation.