20150219-世界经济论坛-Strategic_Infrastructure_Mitigation_of_Political_Regulatory_Risk_in_Infrastructure_Projects_48页_1mb

Summary of "Strategic Infrastructure: Mitigation of Political & Regulatory Risk in Infrastructure Projects"

Core Content

This document, prepared by the World Economic Forum in collaboration with The Boston Consulting Group, outlines a comprehensive framework for mitigating political and regulatory risks in infrastructure projects. It emphasizes the importance of infrastructure as a critical enabler of sustainable and inclusive growth, and highlights the need for both public and private sectors to work together to address these risks.

The report estimates that the global infrastructure investment gap is at least $1 trillion annually, with the total required investment reaching $4 trillion per year until 2030. Given the scale of the demand, the public sector alone cannot meet this need, and the private sector must be encouraged to invest. However, private investors are hesitant due to the long-term nature of infrastructure projects and the potential for political and regulatory instability.

Main Viewpoints

• Infrastructure is essential for growth and development, both in emerging and developed economies.
• Political and regulatory risk is a major concern for private investors due to the long lifespan of infrastructure assets and the potential for changes in policy and regulation.
• A multi-stakeholder approach is necessary to effectively manage these risks, involving collaboration between the public and private sectors.
• There is a need for a stable regulatory environment, which can be achieved through robust laws, transparent administration, and effective dispute-resolution mechanisms.
• The private sector can also take measures to manage risk, such as using financial instruments and engaging with communities and public agencies.

Key Information

Infrastructure Investment Gap

• Global infrastructure investment gap: At least $1 trillion annually.
• Annual investment required: $4 trillion until 2030.
• Existing infrastructure value: Approximately $50 trillion globally, which can be optimized to reduce the need for new investments.

Risk Categories

The report identifies four main categories of risk affecting infrastructure projects:

1. Business factors
2. Political and regulatory risk
3. Macroeconomic and social environment
4. Force majeure

Political and regulatory risk is further divided into project-specific and economy-wide risks.

Risk Mitigation Framework

The report presents a risk-mitigation framework with 20 measures, categorized as follows:

Public-Sector Measures

• Robust infrastructure regulation and contracts
• General stability of laws and regulation
• Reliable and efficient administration
• Reliable dispute-resolution mechanisms
• International commitments

Private-Sector Measures

• Appropriate use of financial instruments
• Effective interaction with the public sector
• Inclusive community engagement
• Responsible business conduct
• Culture of open dialogue

Joint Public-Private Measures

• Collaboration to ensure regulatory stability
• Shared investment mechanisms
• Transparent and constructive communication

Importance of International Commitments

• Bilateral Investment Treaties (BITs) and investment protection clauses in free trade agreements are important tools for mitigating political and regulatory risk.
• Many BITs are underutilized or have flaws such as vague protection clauses and controversial arbitration procedures.
• New standards and innovative clauses are being developed to improve these instruments.

Role of the Private Sector

• Private companies can use political-risk insurance or guarantees to manage risks such as expropriation or currency inconvertibility.
• A carefully designed ownership structure can help reduce political intervention, with international co-owners and local partners playing a key role.
• Effective communication with public agencies and communities is crucial for managing soft risks and building trust.
• Maintaining professional and sustainable operations reduces the likelihood of political or regulatory interference.

Multi-Stakeholder Collaboration

• The report underscores the need for collaboration between public and private stakeholders to develop and implement effective risk mitigation strategies.
• Open dialogue and shared responsibility are key to achieving a balance between regulatory stability and government flexibility.
• The Strategic Infrastructure Initiative aims to provide a roadmap for governments and stakeholders to implement comprehensive frameworks and best practices across the entire infrastructure life cycle.

Conclusion

The report highlights the interconnected nature of political and regulatory risk in infrastructure projects and proposes a holistic approach to address these challenges. It calls for actionable measures from both the public and private sectors, as well as international cooperation, to ensure the successful financing and implementation of infrastructure projects that support long-term economic growth and development.