Enhancing the efficiency of infrastructure projects to improve access to finance

Jyoti Bisbey, Seyed Hossein Hosseini Nourzad, Ching-Yuan Chu, Maryam Ouhadi

Article ID: 1175
Vol 4, Issue 1, 2020, Article identifier:27-49

VIEWS - 935 (Abstract) 398 (PDF)

Errata in:

Journal of Infrastructure, Policy and Development, 1238



While there has been much discussion about the large infrastructure needs in Asia and the Pacific, less attention has been paid to public expenditure efficiency in infrastructure services delivery. New constructions are not the only solution, especially when governments have limited capital to invest. Globally, new infrastructure projects face delays and cost overruns, leading to an inefficient use of public resources. The root causes include the lack of transparency in project selection, the lack of project preparation, the silo approach by public entities in assessing feasibility studies, and the lack of public sector capacity to fully develop a bankable pipeline of projects. To tackle these issues, governments need a smarter investment approach and to do so, enhancing public service efficiency is very crucial. The paper suggests a “whole life cycle” (WLC) approach as the main strategic solution for the discussed issues and challenges. We expand the definition of WLC to include the entire life cycle of the infrastructure asset from need identification to its disposal. The stages comprise planning, preparation, procurement, design, construction, operation and maintenance, and disposal. This is because we believe any efficient or inefficient decision throughout such a wide life cycle influences the quality of public services. Hence, in this holistic approach, infrastructure life cycle consists of four phases: planning, preparation, procurement, and implementation. Governments could enhance public efficiency and thus improve access to finance throughout the WLC by several solutions. These are (i) preparing infrastructure master plan and pipelines and long-term budgeting during the planning phase; (ii) establishing framework and guidelines and improving governance during preparation phase; (iii) promoting standardization, transparency, open government, and contractual consistency during the procurement phase; and finally (iv) continued role of government and total asset management during the implementation phase. In addition to these phase-specific means, key WLC solutions include proper use of technology, capacity building, and private participation in general and public-private partnership (PPP) in particular.


efficiency; infrastructure; finance; public sector; PPP; whole life cycle; planning; preparation; procurement; implementation; disposal; PIMA; public services

Full Text:



Abiad A and Teipelke R (2017). "Infrastructure provision in developing Asia's giants: A comparative perspective on China, India, and Indonesia". Journal of Infrastructure, Policy and Development, 1(1), 24-43. http://dx.doi.org/10.24294/jipd.v1i1.7.

Acerete JB, Shaoul J, Stafford A and Stapleton P (2010). “The cost of using private finance for roads in Spain and the UK”. Australian Journal of Public Administration, 69(s1): S48–S60. https://doi.org/10.1111/j.1467-8500.2009.00654.x.

Afonso A, Schuknecht L and Tanzi V (2005). “Public sector efficiency: An international comparison”. Public Choice, 123(3–4): 321–347. https://doi.org/10.1007/s11127-005-7165-2.

Agarwal R, Chandrasekaran S and Sridhar M (2016). Imagining Construction’s Digital Future. McKinsey & Co.

Akbiyikli R (2017). “Value for money (VFM) evaluation in PPP projects: An overview”. Journal of Current Construction Issues—CEPPIS 2017, 2017: 29–45.

Aldridge S, Hawkins A and Xuereb C (2016, 25 January). “Improving public sector efficiency to deliver a smarter state”. Civil Service Quarterly. London, UK: Cabinet Office.

Bonifaz JL and Itakura R (2014). “An analysis of inefficiency of big urban water utilities in Latin-America”. Working Papers 14-13. Lima, Peru: Centro de Investigación, Universidad del Pacífico.

Clark C, Aldridge M and Higgins C (2016). SMART Scale: An Innovative Program Accelerating the Energy Efficiency Market. Santa Cruz, CA: Ecology Action. https://doi.org/10.2172/1340290.

Curristine T, Lonti Z and Joumard I (2007). “Improving public sector efficiency: Challenges and opportunities”. OECD Journal on Budgeting, 7(1): 1–41. https://doi.org/10.1787/budget-v7-art6-en.

de Richecour AB and Heggie IG (1995). “African road funds: What works and why?” Sub–Saharan Africa Transport Policy Program (SSATP) Working Paper No. 14. World Bank and UN Economic Commission for Africa.

Farrell MJ (1957). “The measurement of productive efficiency”. Journal of Royal Statistical Society: Series A, 120(3): 253–281. https://doi.org/10.2307/2343100.

Flyvbjerg B, Stewart A and Budzier A (2016). “The Oxford Olympics Study 2016: Cost and cost overrun at the Games”. Said Business School WP 2016-20. Oxford, UK: University of Oxford. https://doi.org/10.2139/ssrn.2804554.

Fourie FC and Burger P (2000). “An economic analysis and assessment of Public‐Private Partnerships (PPPs)”. South African Journal of Economics, 68(4): 305–316. https://doi.org/10.1111/j.1813-6982.2000.tb01274.x.

Gaspar V and Rhee CY (2018). "The Digital Accelerator: Revving Up Government in Asia". IMF Blog, Available from: https://blogs.imf.org/2018/09/26/the-digital-accelerator-revving-up-government-in-asia/.

Glanz J, Pianigiani G, White J and Patanjali K (2018, 6 September). Genoa Bridge Collapse: The Road to Tragedy. The New York Times.

Gibson J and Rioja F (2017). "Public infrastructure maintenance and the distribution of wealth". Economic Inquiry, 55(1), 175-186. https://doi.org/10.1111/ecin.12371.

Guasch JL, Benitez D, Portables I and Flor L (2014). “The renegotiation of PPP contracts: An overview of its recent evolution in Latin America”. International Transport Forum Discussion Papers 2014/18. Paris, France: OECD. https://doi.org/10.1787/2223439X.

Henckel T and McKibbin WJ (2017). "The economics of infrastructure in a globalized world: Issues, lessons and future challenges". Journal of Infrastructure, Policy and Development, 1(2), 254-272. https://doi.org/10.24294/jipd.v1i2.55.

Hurley J, Morris S and Portelance G (2019). "Examining the debt implications of the Belt and Road Initiative from a policy perspective". Journal of Infrastructure, Policy and Development, 3(1), 139-175. http://dx.doi.org/10.24294/jipd.v3i1.1123

International Monetary Fund (2015). IMF Survey: Closing Efficiency Gaps Means Big Gains for Public Investment. Washington, DC: International Monetary Fund.

Kahn ME and Levinson DM (2011). “Fix it first, expand it second, reward it third: A new strategy for America’s highways”. Discussion Paper 2011-03. Washington, DC: Brookings Institution.

Kohler JC (2011). Fighting Corruption in the Health Sector: Methods, Tools and Good Practices. New York, NY: United Nations Development Programme.

Lledó V, Yoon S, Fang X, et al. (2017). Fiscal Rules at a Glance. Washington, DC: International Monetary Fund.

Maraña P, Labaka L and Sarrieg JM (2017). “Maintenance in critical infrastructures: The need for public-private partnerships”. In: Carnero MC and González-Prida V (Eds.), Optimum Decision Making in Asset Management. Hershey, PA: IGI Global. pp. 62–82. https://doi.org/10.4018/978-1-5225-0651-5.ch003.

Norris GA (2001). “Integrating life cycle cost analysis and LCA”. The International Journal of Life Cycle Assessment, 6(2): 118–120. https://doi.org/10.1007/BF02977849.

Organisation for Economic Co-operation and Development (2014), "Good Practices in Supporting Supreme Audit Institutions". OECD, Paris. Available from: https://www.oecd.org/dac/effectiveness/Final%20SAI Good Practice Note.pdf.

Petrillo A, De Felice F, Jannelli E, et al. (2016). “Life cycle assessment (LCA) and life cycle cost (LCC) analysis model for a stand-alone hybrid renewable energy system”. Renewable Energy, 95: 337–355. https://doi.org/10.1016/j.renene.2016.04.027.

Reside RE and Mendoza AM (2010). “Determinants of outcomes of public-private partnerships (PPP) in infrastructure in Asia”. UPSE Discussion Paper No. 2010,03. Quezon City, the Philippines: University of the Philippines School of Economics.

Sarmento JM and Renneboog L (2014). “The Portuguese experience with public-private partnerships”. CentER Discussion Paper Series No. 2014-005. Tilburg, the Netherlands: Tilburg University. https://doi.org/10.2139/ssrn.2378720.

Schütte S, Reddy P and Zorzi L (2016). A Transparent and Accountable Judiciary to Deliver Justice for All. New York, NY: United Nations Development Programme.

Serebrisky T, Suárez-Alemán A, Pastor C and Wohlhueter A (2017). Efficiency of Public Infrastructure Delivery. Washington, DC: Inter-American Development Bank. https://doi.org/10.18235/0000846.

Suárez-Alemán A, Serebrisky T and Perelman S (2019). “Benchmarking economic infrastructure efficiency: How does the Latin America and Caribbean region compare?” Utilities Policy, 58: 1–15. https://doi.org/10.1016/j.jup.2019.03.003.

United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) (2019). Economic and Social Survey of Asia and the Pacific 2019: Ambitions Beyond Growth. Bangkok, Thailand: UN ESCAP.

Woetzel J, Garemo N, Mischke J, et al. (2017). Bridging Infrastructure Gaps: Has the World Made Progress? McKinsey & Co.

United Nations Development Programme (2011). Fighting Corruption in the Education Sector: Methods Tools, and Good Practices. New York, NY: United Nations Development Programme.

World Bank Group (2016). The APMG Public-Private Partnership (PPP) Certification Guide. Washington, DC: World Bank Group.

_____ (2017). PPP Reference Guide 3.0. Washington, DC: World Bank Group.

Yescombe ER and Farquharson E (2018). Public-Private Partnerships for Infrastructure: Principles of Policy and Finance. 2nd Edition. Oxford, UK: Butterworth-Heinemann. https://doi.org/10.1016/B978-0-08-100766-2.00002-4.

Zen F (2019). “Public–private partnership development in Southeast Asia”. Asian Development Bank Economics Working Paper Series No. 553. Mandaluyong, the Philippines: Asian Development Bank. https://doi.org/10.2139/ssrn.3339110.

Zhang Y and Hu Y (2017, 5 January). Efficiency in Government Top Priority. China Daily.

DOI: http://dx.doi.org/10.24294/jipd.v4i1.1175


  • There are currently no refbacks.

Copyright (c) 2020 Jyoti Bisbey, Seyed Hossein Hosseini Nourzad, Ching-Yuan Chu, Maryam Ouhadi

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Creative Commons License
This site is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.