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Article

Innovative Infrastructure Fund to Ensure the Financial Sustainability of PPP Projects: The Case of Chile

Department of Transportation Engineering, Urban and Regional Planning, Escuela de Caminos, Canales y Puertos, Universidad Politécnica de Madrid, 28040 Madrid, Spain
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Sustainability 2020, 12(23), 9965; https://doi.org/10.3390/su12239965
Received: 28 October 2020 / Revised: 25 November 2020 / Accepted: 26 November 2020 / Published: 28 November 2020
Recently, the Chilean government created the Chilean Infrastructure Fund (CIF) that will allow taking advantage of the value of existing infrastructure assets. The fund will enable the government to finance new infrastructure projects with the resources obtained from new concessionaires’ payments to the government for the value of retendering existing public-private partnership (PPP) projects. The purpose of this paper is to evaluate the contribution that this new public institution will bring to the financial sustainability of infrastructure in Chile, the opportunities and challenges for its implementation, and its economic value. The research has a qualitative and quantitative approach. Based on the understanding of the new concept of asset recycling, the application of economic foundations, and financial methodologies such as discounted cash flows and real options, the research assessed the institutional and economic value of the new Chilean Infrastructure Fund. The main findings are that the new Chilean Infrastructure Fund will create public value and public wealth since it will foster good governance, streamline the concession system, accelerate the implementation of sustainable PPP projects, and improve planning schemes among others. Other countries could follow this experience, promoting infrastructure funds to improve governance and accelerate the implementation of sustainable PPP projects. View Full-Text
Keywords: asset recycling; economic infrastructure; public value; public wealth; public-private partnership (PPP); real options; social infrastructure; sustainability; transportation; valuation asset recycling; economic infrastructure; public value; public wealth; public-private partnership (PPP); real options; social infrastructure; sustainability; transportation; valuation
MDPI and ACS Style

Mansilla, P.; Vassallo, J.M. Innovative Infrastructure Fund to Ensure the Financial Sustainability of PPP Projects: The Case of Chile. Sustainability 2020, 12, 9965. https://doi.org/10.3390/su12239965

AMA Style

Mansilla P, Vassallo JM. Innovative Infrastructure Fund to Ensure the Financial Sustainability of PPP Projects: The Case of Chile. Sustainability. 2020; 12(23):9965. https://doi.org/10.3390/su12239965

Chicago/Turabian Style

Mansilla, Patricio, and José M. Vassallo 2020. "Innovative Infrastructure Fund to Ensure the Financial Sustainability of PPP Projects: The Case of Chile" Sustainability 12, no. 23: 9965. https://doi.org/10.3390/su12239965

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