PFI deals decline to £7.3bn

by Gill Montia

Story link: PFI deals decline to £7.3bn

Last year, the value of UK Private Finance Initiative (PFI) deals declined to £7.3 billion, from a record level of £9.6 billion in 2006.

In a recent report, IFSL (International Financial Services, London), which promotes the UK-based financial services industry throughout the world, states as follows:

The number of PFI deals stood at 60 in 2007, which is in line with the two previous years.

In 2007, the average size of a deal fell to £122 million, down from £150 million in 2006.

Across Europe, the sectors most prominent in PFI since 2003 have been health, education, defence and accommodation.

However, reviewing the data for the past 20 years, transport takes second place, next to health.

Turning to the European market for Public Private Partnerships (PPP) the figures for signed deals remained flat in 2007, at €7.4 billion. Projects being procured reached €67 billion in 2007, up from €55 billion in 2006.

European PPPs reached recorded levels in 2005, when the value of deals agreed stood at €8.9 billion.

Between 2001 and 2007, the capital value of signed deals has been highest in Spain, Italy and Ireland. However activity elsewhere in Europe looks set to expand.

Italy is expected to become Europe’s largest PPP market, with €30 billion in projects being procured, mainly in connection with motorways and metro.

Germany and Greece have PPP procurements to the value of €9 billion and €6 billion respectively.