DUBLIN--(BUSINESS WIRE)--Research and Markets(http://www.researchandmarkets.com/research/4c2adf/russia_infrastruct) has announced the addition of the "Russia Infrastructure Report Q1 2012" report to their offering.
BMI View: The completion of the tender for the first phase of the Western High Speed Diameter is certainly the major development in Russia's transport sector for 2011. An international consortium was awarded the project, but as we expected, with a strong presence of state-owned banks, which we believe will be instrumental in arranging the financing for this project. In the wider infrastructure sector, capital outflow is continuing but is going largely unnoticed by markets. This poses a risk for the infrastructure sector, which relies on foreign investor confidence to import in expertise for the large scale PPPs the country wants to implement.
The themes that dominate developments in Russia's infrastructure sector are:
- The Russian government's decision to create a US$10bn investment fund highlights the state's commitment to sharing the risks inherent in investment in Russia with the private sector - in an effort to attract a greater level of private capital. The government aims to use this investment fund as seed money to mobilise between US$50bn and US$90bn over the next five years, by financing up to 20% of the cost of privately-procured development projects.
- The 2018 World Cup win has prompted a change in the long term-forecasts, with growth accelerating, especially in the non-residential and residential construction sector. However, we see risks to the implementation of projects and foresee problems related to project cost overruns.
- Furthermore, infrastructure associated with the export of commodities (pipelines, ports and transport infrastructure - to support oil and gas output in East Siberia) has the highest growth potential - as development is predicated on growth in the natural resources sector.
Companies Mentioned:
- Mostootryad No 19
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