PPIAF Traffic Risk Brief: Understanding Traffic Risk and Traffic Forecasting
PPIAF ISSUE BRIEF • DECEMBER 2016
PPIAF ISSUE BRIEF • DECEMBER 2016
Since 2012 PPIAF has assisted the Government of Lao People’s Democratic Republic (Lao PDR) to attract much needed private sector investment and participation into the country’s under-served highway network. The government identified a priority PPP highway project in 2012 with the PPIAF assistance, and recently decided to move the project forward as the first road PPP in the country.
Decades of underinvestment in infrastructure in the Philippines has created a huge backlog of projects that need to be studied, developed, and tendered, demanding resources and expertise beyond the capacity of the government. Transportation infra- structure is a significant component of the government’s focus, and to address this, IFC was hired to advise the government on the NAIA Expressway Project—a key part of Metro Manila’s urban expressway system.
Flannery, Aimee, Jessica Manns, and Marie Venner. 2016.
National Cooperative Highway Research Program (NCHRP) Synthesis 494: Life-Cycle Cost Analysis for Management of Highway Assets. Washington, DC: Transportation Research Board. [#4381]
On July 17, 2014, the Build America Investment Initiative was implemented as a government-wide effort to increase infrastructure investment and economic growth. As part of that effort, the U.S. Department of Transportation (USDO T) established the Build America Transportation Investment Center (BA TIC). The BA TIC helped public and private project sponsors better understand and utilize public-private partnerships (P3s) and provided assistance to sponsors seeking to navigate the regulatory and credit processes and programs within the Department.
This guide is primarily intended for technical officials in developing country governments looking to understand the potential traffic risk in highway PPP projects, how it can affect the viability of projects, and the actions they can take to maximize project success.
Abidjan’s bridges and infrastructure have been under severe strain following Côte d’Ivoire’s decade-long civil conflict, and the city’s acute traffic problems threatened to hinder recovery. The new Henri Konan Bedié toll bridge, which consists of two three-lane carriageways and cuts the journey time between two major districts of Abidjan from one hour to 15 minutes, was designed to put Abidjan back on the path to prosperity and ease citizens’ lives.
Low traffic volume, and the low toll revenues that result, contribute greatly to the failure of toll road public-private partnerships (PPPs). This risk has several sources, including forecasting error, uncertainty inherent to the forecasting process, and bias. While some level of traffic risk will always be present in highway PPPs, governments, the private sector, and financiers can take steps to reduce and manage this risk through robust forecasting techniques and selecting the appropriate project structure.
The BA-093 system located in the state of Bahia, in Northeast Brazil, comprises a series of roads stretching over 126 kilometers. The system was in a severe state of disrepair, as it had never been properly maintained or rehabilitated since it was built since its development in the 1950s.