Spread valuation and risk on transport infrastructure loans

Antonio Lara-Galera, Vicente Alcaraz-Carrillo de Albornoz, Juan Molina-Millán and Belén Muñoz-Medina

Economics of Transportation, 2025, vol. 41, issue C

Abstract: For some time now, public administrations in many countries have been subject to strict budgetary constraints to control the public deficit. The Public Private Partnership (PPP) model in this context is a useful vehicle to develop public infrastructures. Despite its attractiveness and potential, there is an accumulation of evidence that questions this model with different experiences showing that PPPs are relatively risky projects for all participants. This is especially true for financial creditors, who usually lend up to 85% of the funds needed for financing the project.

Keywords: Loan; PPP; Spreads; Derivatives; Risk (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecotra:v:41:y:2025:i:c:s2212012224000510

DOI: 10.1016/j.ecotra.2024.100392

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