Challenges to Public-Private Transport Infrastructure Development in Mexico
NAVAL WAR COLL NEWPORT RI JOINT MILITARY OPERATIONS DEPT
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To develop and maintain its transportation infrastructure, the government of Mexico relies on private investment. Years of neglecting its roads has caused Mexico to fall behind its regional economic competitors. The Calderon administration sought to reverse that trend by increasing public infrastructure spending to attract private investment. However, Mexicos transport infrastructure will lag behind its regional competitors unless the government of Mexico continues to implement transparent and efficient regulatory reform measures and improves the technical expertise of its infrastructure planners and regulators. The National Infrastructure Program supported the presidents goal through public-private partnership, but it was built on a weak institutional foundation and private investment never materialized to expected levels. Mexicos infrastructure competitiveness stagnated due to underlying bureaucratic inefficiency and a weak legal framework. Changing domestic and economic conditions in 2009 exacerbated the situation. While private participation remained weak in Mexico, Chile and Brazil maintained a robust environment for infrastructure investment. Both had a sound regulatory framework and the institutional capacity to design viable, risk-sharing concessions. Mexico needs private investment to meet its infrastructure development goals. By continuing institutional and regulatory reform measures, it will reduce the bureaucratic impediments to private participation.
- Economics and Cost Analysis
- Government and Political Science
- Civil Engineering
- Surface Transportation and Equipment