Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • June 2010 (Revised September 2011)
  • Background Note
  • HBS Case Collection

An Overview of Project Finance and Infrastructure Finance--2009 Update

By: Benjamin C. Esty and Aldo Sesia
  • Format:Print
  • | Language:English
  • | Pages:39
ShareBar

Abstract

Provides an introduction to the fields of project finance and infrastructure finance and gives a statistical overview of project-financed investments over the years from 2005 to 2009. Examples of project-financed investments include the $1.4 billion Mozal aluminum smelter in Mozambique, $4 billion Chad-Cameroon pipeline, $6 billion Iridium global satellite telecommunications system, $900 million A2 Toll Road in Poland, $20 billion Sakhalin II gas field in Russia, and the $28 billion Dabhol power project. Globally, firms financed $240 billion of capital expenditures using project finance in 2009, down from $409 billion in 2008 as the financial crisis hit the Western markets. The use of project finance has grown at a compound rate of 0% over the last five years, 4% over the past 10 years, and 12% over the past 15 years. This note focuses primarily on private sector investment in industrial and infrastructure projects and contains four sections. The first section defines project finance and contrasts it with other well-known financing mechanisms. The second section describes the evolution of project finance from its beginnings in the natural resources industry in the 1970s, to the U.S. power industry in the 1980s, to a much wider range of industry applications and geographic locations in the 1990s, and most recently to infrastructure finance in the 2000s. The third section provides a statistical overview of project-financed investment over the last five years (2005 to 2009) and looks at industry, project, and participant specific data. The third section also provides recent data on infrastructure investments and public-private partnerships. The final section discusses current and likely future trends.

Keywords

Project Finance; Infrastructure; Investment; Projects; Trends

Citation

Esty, Benjamin C., and Aldo Sesia. "An Overview of Project Finance and Infrastructure Finance--2009 Update." Harvard Business School Background Note 210-061, June 2010. (Revised September 2011.)
  • Educators
  • Purchase

About The Author

Benjamin C. Esty

Finance
→More Publications

More from the Authors

    • April 2022
    • Faculty Research

    Tempur Sealy International (A, B & C)

    By: Benjamin C. Esty and Daniel Fisher
    • March 2022
    • Faculty Research

    MTN: Unlocking Value While Driving Socioeconomic Progress

    By: Benjamin C. Esty, Pippa Tubman Armerding and Dilyana Karadzhova Botha
    • February 2022
    • Faculty Research

    SpartanNash Company: The Amazon Warrants (A)

    By: Benjamin C. Esty, E. Scott Mayfield and Daniel Fisher
More from the Authors
  • Tempur Sealy International (A, B & C) By: Benjamin C. Esty and Daniel Fisher
  • MTN: Unlocking Value While Driving Socioeconomic Progress By: Benjamin C. Esty, Pippa Tubman Armerding and Dilyana Karadzhova Botha
  • SpartanNash Company: The Amazon Warrants (A) By: Benjamin C. Esty, E. Scott Mayfield and Daniel Fisher
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Digital Accessibility
Copyright © President & Fellows of Harvard College