PROFIT - Private operation and financing of trans-European networks
Overview
Background & policy context:
The gap between socio-economic and financial profitability is a major barrier in the development of the trans-European network. When a project is not sufficiently profitable for the private sector, direct government contributions or introduction of user charges can be used to let the private sector participate. However, even when a project offers a sufficient financial return for the private investor, there may be arguments for public intervention. The public sector could be involved to safeguard the interests of non-users, to improve risk sharing, or to mix public and private skills, for example combining the public sector experience of infrastructure planning with the commercial and financial skills of the private sector.
Objectives:
The objective of PROFIT was to help decision-makers assess whether or not public private partnerships (PPP) can offer an attractive option for successful and accelerated implementation of trans-European network projects. Specific aims were:
- to provide a comprehensive methodological framework for assessing the PPP potential of a trans-European network project, based on financial attractiveness and socio-economic costs and benefits,
- to develop a practical and easy-to-use handbook for decision-makers which offers 'quick scan' guidelines of the PPP potential of infrastructure projects.
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