Bracewell’s Andrej Kormuth recently discussed with MEED writer Jennifer Aguinaldo how lower oil revenues have once again broadened Middle East opportunities for public-private partnerships.
“The tightening fiscal position of most GCC countries means that all expenditure, in whatever guise, will be reconsidered,” said Kormuth. “This will no doubt affect planned infrastructure and potentially under-execution projects as most GCC governments hunt for savings in their budgets.”
As attention returns to infrastructure development in this tighter fiscal environment, regional governments are coming to freshly appreciate PPP models and their potential to defer capital expenditure through multi-decade amortization.
“Gone are the days when any government has the surplus spending power to pay for infrastructure developments in a lump sum amount or short milestone payments, as would be the case under the direct engineering, procurement and construction (EPC) model,” added Kormuth.
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