InfrastructurPwC:PPPfinancingfore

The Economy Ministry is setting up an infrastructure fund with the contribution of European authorities that will finance projects amounting to 1 billion euros in the form of public-private partnerships (PPPs).

The general secretary of public investments, Panayiotis Korkolis, who is responsible for the Partnership Agreement for the Development Framework (ESPA) in Greece, announced at a conference titled “Invest EU: Partnerships in Europe and Greece” on Wednesday that an agreement to that effect will be signed with the European Investment Bank next week.

The financing of the new fund for infrastructure will come from ESPA (200 million euros), state borrowing from the EIB (200 million), the resources of the European Fund for Strategic Investments (200 million) and bank loans (300 million).

The aim of the new fund is to offer favorable financing terms to the private and public sectors for the implementation of small and medium-sized projects, with an emphasis on the domains of energy, the environment and urban development.

According to sources, the fund’s plans include integrated refuse management systems for Thessaloniki and Rhodes, broadband internet infrastructure development projects, and construction of school units in central Macedonia, Corfu and Hania.

The government is, according to Deputy Economy Minister Stergios Pitsiorlas, being forced to overcome “the ideological reluctance and the inhibitions existing today” and make the most of PPPs as a tool. European Commission representative Aris Peroulakis said this instrument could “multiply the possibilities for the construction of infrastructure projects.”

Pitsiorlas added that such projects include the refuse management sector, which may “offer great investments provided opposition of a political character is overcome.”

He stressed that the policy of local authorities will be crucial, noting that they prefer to borrow from the Loans and Consignment Fund to finance even the simplest of projects such as street lighting, instead of choosing public-private partnerships.