Trends port concessions

Transcription

1 Trends port concessions 23 May 2012 Jerusalem Wout Korving The

2 Contents 1. Some facts and figures in port concessions 2. Qualitative features of port concessions 3. Qualitative assessment of trends 4. Expectations for the near future 5. Conclusions

3 Some facts and figures in port concessions 1. Some concession numbers Between 2000 and 2010 steady growth to over 30 concessions (15 tendered) concessions per year with drop during first credit crisis Reduction since start of second credit crisis 2. The regional spread is clear Few deals in Africa and middle east Majority of deals in Asia, America and Europe 3. Large variety in concession concepts Deals on new terminal development Deals on transfer of activities from authority to concessionaire Deals based on extensive competition and based on beauty contest Financing solutions on a case by case base

4 Qualitative features of port concessions 1. Concessions in port sector appear complex Typically long lead times between announcement and close Contract and procurement docs often on a taylor made basis Large variety in procurement processes Relatively low number of concessions per country/pa 2. The market is typical Bidding for concessions is a global business Limited participation in bidding phase by non-industrial investors Relatively large risk taking on project financing 3. The financial crisis has a major impact Financing for PA s and concessionaires becomes difficult Bidding consortiums become more selective and careful Transferring risks tends to be limited

5 Qualitative assessment of trends 1. Market still in search of standards PA s and/or procuring entities often lack deal flow to standardize Lack of international standards on contracts and procurement docs The credit crisis seems to lead to a boost for the BOT concept 2. PAs seem to struggle with expertise PA s high level of expertise seems to reduce knowledge transfer Often transfer of knowledge through IFIs and/or external advisors 3. Access to financing market seems limited PA s can typically rely on sovereign risk profile Expertise with commercial financing seems limited Consequently difficult to anticipate the consequence of the credit crisis on concessions

6 Expectations for the near future 1. Credit crisis will have short term impact PA s tend to turn to the BOT concept Financing BOT contract will become increasingly difficult Bidders will become more selective/conditional in their participation Bidders will price more conservatively 2. PA s may want to rethink the strategy It becomes increasingly interesting to rethink risk approach It may be interesting to share e.g. volume risks/project finance risks This may lead to more mainstream procurement processes A split between two partners (operator and basic infra) is possible The upside of such deliberate procurement, contracting and risk allocation approach may prove to be 1.5 to 2 times better deals

7 Conclusions 1. Necessary to anticipate the financial crisis impact 2. It becomes increasing attractive to redefine risk transfer approach 3. It seems attractive to support alternative financing solutions 4. The upside of redefined concession deals will increase with the credit crisis 5. The upside of knowledge buildup and transfer between PA s increases