Private Participation in the Rail Sector-Recent Trends
Author: Nicola Tynan Date: 6/1/1999 (PDF, 200KB)
Private participation in the railway sector has increased significantly during the 1990s, with fourteen developing countries reaching financial closure on thirty-seven projects in 1990-97. Although this resurgence in private participation is still in its infancy, the experience in Latin America highlights some lessons. For example, the renegotiation of freight concessions in Argentina has revealed the importance of establishing flexible contracts and setting clear renegotiation or other adjustment mechanisms in advance. Developing countries can also learn from the experience of OECD countries with different models of private involvement, such as Japan, New Zealand, and the United Kingdom. For example, the benefits of splitting infrastructure provision from service operation have driven many of the reforms in OECD countries and may offer one solution to the access pricing issues faced when vertically integrated companies are concessioned with open access requirements.