CHAPTER 6 The Digitalisation of Infrastructure And PPP Policy

Note:

This Chapter was not included in the original G20 Survey questionnaire. Nevertheless, given the importance of issues of digitalisation, as stated in the G20 Osaka Leaders' Declarationi, we have also covered the G20 trends related to digitalisation of infrastructure policy.

Digitalisation in Infrastructure is Marked by the Development of Project Databases and Platforms

Digitalisation is a cross-cutting issue for all spheres of economy and society, including infrastructure. Luckily, in this specific case, digitalisation yields benefits at both the national and international level.

On the national level, it dramatically enhances the monitoring of infrastructure development performance and resources and provides evidence for decision-making. Also, digital products support the development of the PPP market by communicating policy signals, raising awareness of business and public community, providing for a virtual marketplace of infrastructure-related services and know-how.

On the global scale, spillovers resulting from digitalisation are also tangible.

Efforts in closing global data gaps help governments worldwide to share practice and experience while investors may determine attractive projects, as well as showcase their initiatives in search for additional resources and backup.

Not being able to provide an exhaustive overview of all existing aspects of digitalisation in infrastructure, this chapter, however, outlines common trends of developing digital products, namely project databases and platforms.

International Digital Products Contribute to Global Development of Infrastructure

International infrastructure and PPP databases contribute significantly to global infrastructure development as they accumulate practice from multiple countries. Though not explicitly detailed as a consequence of the scarcity and locally conditioned inconsistency of information, they are an indispensable tool for a comparative cross-country analysis.

To date, four large international products exist, each with exceptional characteristics and mission.

World Bank's PPP Project Database is the largest with over 7 thousand infrastructure projects available for free access.ii Users can visualise this data through a set of interactive tools including maps, plots and diagrams.

IJ Global PPP Projects and Transactions Database not only contains detailed information on many projects but also features a unique base of financial transactions related to PPPs, including the data on bank credits and project bonds.iii

Global Infrastructure Hub, the G20-backed initiative, offers a group of digital products.iv Among them are a pipeline and a showcase of countries' infrastructure and PPP projects, historical and forecasted figures on global infrastructure needs and investment, country risk profiles and guides to aid investors in launching and implementing infrastructure projects, as well as dozens of analytical publications, blog posts and news.

SIF SOURCE is a multilateral digital platform specifically designed for an ERP- inspired manner of infrastructure and PPP project management.v ERP approach is used to integrate and organize the data necessary for all tasks from front office to back office operations. The platform envisages a dashboard of tools especially fit for steering complex international endeavours. For instance, it is possible to assign specific tasks to various subcontractors and monitor their work using the same project profile. In other words, each subcontractor will be granted rights to modify certain restricted parts of the project, thus contributing to the project's transparency and visibility. SOURCE is led and financed by a consort of multilateral development banks including World Bank, ADB, EBRD, IDB, and EIB.

Infrastructure Data Initiative

In 2017, the Infrastructure Data Initiative (IDI), was introduced jointly by the European Investment Bank, the Global Infrastructure Hub, the Long-Term Infrastructure Investors Association and the OECD in the context of G20 activities on infrastructure.

IDI was launched to address the issue of establishing infrastructure as an asset class through data collection and improving the availability of infrastructure investment data.

The initiative, therefore, targets several priority areas: financial performance benchmarks, economic and impact analysis and ESG performance.

The initiative aims to improve the availability and quality of data and information on infrastructure investment, particularly at granular project and cash flow level, to identify the critical data that is needed to develop infrastructure investment standards and benchmark.

The IDI has established a background approach presented to the G20 based on building up from the two existing MDB data repositories SOURCE and GEMs. These two platforms are in the process of being inter-connected so as to serve as IDI data central basis. In implementing G20 Roadmap on data, the IDI process will add up to this basis and interface further complementary infrastructure data systems.

National Databases and Platforms

National products tend to offer data accustomed to specific country regulations and practice. Their main call is to facilitate market growth and attract investments.

Nowadays, we are witnessing rapid evolution of domestically developed databases into full-featured digital ecosystems consisting of several groups of data and functional modules:

o pipeline and database of ongoing infrastructure and PPP projects;

o characteristics of infrastructure governance and measures government support;

o expert marketplace and 'Facebook' of market actors;

o ERP project management; o interactive analytical and other tools.

As shown by the G20 Survey, seven countries use infrastructure project databases, and several have already moved on to introduce comprehensive infrastructure platforms with Canada, Mexico and Russia being the pioneers of transformation.

Digital Product Developer

Projects and Pipeline

PPP Projects' Transactions

Institutional and Law Framework

Pages of Companies & Organisations

Expert Communication and Marketplace

ERP Module for Project Management

Interactive Analytical Tools

Global

WB

GIH

SOURCE

IJ Global

National

Australia

Canada

Colombia

Mexico

Peru

Russia

S. Africa

UK

In Place

Not in Place

Global Infrastructure Hub

The GI Hub works with public and private sectors globally to increase the flow and quality of infrastructure projects around the world. It shares data, knowledge and leading practices, and help the public and private sectors work more closely to deliver public infrastructure projects.

To date, GIH offers several interactive infrastructure tools to support local policies and beacon infrastructure investments. We present the most prominent as follows.

Global Investor Survey Reports provide new investor insights on changing infrastructure markets. The latest survey reveals vital insights to help policy leaders better understand investor perceptions and challenges. In 2019, over 300 respondents participated, representing USD10 trillion in assets under management.

InfraCompass is a tool for exploring a country's capability to deliver infrastructure projects. It encompasses the performance and potential of 56 countries to deliver infrastructure projects, identify priority reforms and pinpoint leading practices across infrastructure governance & institutions, regulatory frameworks, permits, planning, procurement and delivery.

Global Infrastructure Outlook is aiming at forecasting infrastructure investment needs and gaps globally. It forecasts a global infrastructure need of USD 97 trillion and a projected investment gap of around 16%. The world's electricity, water, communications, and transport investment needs are outlined by country over the next two decades.

PPP Risk Allocation Tool is a searchable guide on typical risk allocation in PPP transactions. This tool provides a set of annotated risk allocation matrices for PPP transactions, across the transport, energy and water and waste sectors. The PPP Risk Allocation Tool should be used to provide additional guidance to countries that wish to develop a programme of bankable PPP transactions.

Global Infrastructure Project Pipeline is a comprehensive, open-source project pipeline database connected to national and multilateral development bank databases, to help match potential investors with projects. Being a free digital platform, it allows governments to promote public infrastructure projects to a global investor network.

PPP Contract Management is a reference tool informed by an in-depth analysis of 250 PPP projects globally that reached financial close between 2005 and 2015 (inclusive) to understand the core issues that arise during the construction and operations phases of a PPP project. From those projects, 25 projects were selected to develop detailed showcases.

Box 5. Data Privacy Issues in the Development of Digital Platforms in Infrastructure.

As the digitalisation of infrastructure governance occurs with today's databases evolving into full-featured platforms and ERP systems, the issues of cybersecurity and digital risks become more important. Theft of confidential corporate data, various data breaches and DoS attacks, as well as creative workarounds employed by power users to avoid paying subscription fees - all this is equally harmful to the future of digital infrastructure policy.

At the same time, infrastructure is hardly the first sphere to face digital risks. Social networks, Internet banking and companies developing engineered systems and enterprise software products have already been struggling to overcome them. Every digital enterprise using either IaaS, PaaS or SaaS model is at risk. Luckily for infrastructure, it is possible to take into account previous experiences.

Authentication and biometrics technologies, including SMS codes, IP registration, security tokens and fingerprint sensors, are widely used to ensure users' data security while maintaining the desired user behaviour in line with company's business model.

Multilayeredness of user access, data protection-driven terms of use, peer review and blockchain may also prove sufficient to protect valuable data in normal circumstances. In the case of dedicated cyber-attacks, server-level security measures should be observed.

Source: MMC.com, Deloitte.com, Insights.sei.cmu.edu

Project Preparation Reference Tool offers useful aid for policy-makers and practitioners in their quest to improve project preparation practices and their capacity for preparing quality infrastructure projects, building upon the G20 Principles for the Infrastructure Project Preparation Phase. The tool seeks to help address challenges faced by governments in early-stage project preparation through providing guidance and lessons learned in the enabling environment for project preparation; financing project preparation; infrastructure planning and project prioritisation; project feasibility, reviews and approvals; and project communication.

Detailed information about the GIH and its recent activities is available at the official website here: www.gihub.org/about/about

SIF SOURCE

SOURCE is the multilateral platform for quality infrastructure-led and funded by the Multilateral Development Banks. It brings about systemic change in the way governments prepare, procure and implement their infrastructure projects.

The Sustainable Infrastructure Foundation (SIF), a not-for-profit Swiss foundation headquartered in Geneva, coordinates the provision of SOURCE platform. SIF is led and financed by the MDBs members of SOURCE Council including World Bank, ADB, EBRD, EIB and IDB.

On their behalf, SOURCE is being developed and implemented in countries by SIF and serves as the MDB data repository. In the context of the G20, the multilateral platform SOURCE is identified with the following functions:

o the provision of a standardised and comprehensive map of aspects to take into account whilst the developing of quality infrastructure;

o deliver MDB tools, reference notes and best practices to project managers at the right juncture in the decision process;

o monitor whether projects meet the intended outcomes and benefits during the implementation period; and

o collect structured and standardised project data at global scale to assess performance of projects against standards, generate analytics, and benchmarks (for example, unit costs).

To date, SOURCE helps in managing over 260 projects in 50 countries, operates in 9 languages and is used by more than 2,600 users.

Mexico Projects Hub

Mexico Projects Hubvi (MPH) is an initiative of the Mexican Government to create an Infrastructure Promotion Office to link investment projects with domestic and foreign investors, encouraging long term financing for infrastructure. The Office was created under the Mexican Government development bank's corporate structure (currently in BANOBRAS), in close coordination with entities and agencies of the public and private sectors.

MPH strives to consolidate an investment projects portfolio of greenfields and brownfields, providing domestic and foreign investors with exceptional visibility of projects sponsored by government entities, transparency regarding projects performance, and comparability in investment opportunities. Also, the platform links projects with domestic and foreign investors to expand long term financing alternatives, contributing to the fulfilment of the objectives of Mexico's National Infrastructure Program, and related sectorial programs.

At the moment, MPH is responsible for disseminating investment opportunities through the hub of projects and promoting a knowledge hub, including best practices to facilitate projects execution. It also offers one-stop-window assistance to investors and provides follow-up to investment projects, in order to learn from experiences of all involved participants in the investment ecosystem.

Ideas for Policy-Making

• Embrace persistent evolution of digital tools and instruments used to govern infrastructure development

• Support closing global infrastructure data gaps by contributing to international databases and platforms

• Pay profound attention to data security issues to curb reputation risks

The projects hub is built on a web platform, allowing the user to browse information according to own needs, and access a factsheet of every project in the platform, including its status and additional data provided by the sponsors. Likewise, the user can access additional information to have a broader understanding regarding the way projects are implemented in Mexico, as well as domestic and foreign documents related to planning, procurement and execution procedures of infrastructure projects and their legal framework.

Russia's Infrastructure Project Support Platform "ROSINFRA"

Created and managed by Russia's National Center for PPP Development, ROSINFRA provides a comprehensive digital solution for developing and launching infrastructure and PPP projects.vii

Its mission is to overcome such innate obstacles of the Russian infrastructure market as lack of experience and low awareness of public and private actors, difficulties and high costs of attracting qualified experts, as well as the shortage of comprehensive data reflecting current state and trends of infrastructure and PPP market.

ROSINFRA's logic of design focuses on facilitating effective communication between parties in investment projects. Its products and services based on various databases form a single digital solution.

Expert Advisory Service allows for online consultations with experts, pre-evaluation of project initiatives and participation in lawmaking by drafting legislative proposals.

Qualified Customer Service provides access to the bank of public project initiatives and helps to navigate through regions and public authorities that showcase their investment projects.

Marketplace Service acts as a 'Facebook' of companies and a tender platform for suppliers in infrastructure projects. It aggregates information about companies' experience and expertise, as well as a range of services and terms and conditions.

Project Constructor Tools allows for quick search of projects satisfying the predefined set of criteria.

Interactive Analytical Digest features over 15 clickable diagrams that show the evolution and current state of the Russian infrastructure and PPP market. Also, there is a base of law enforcement practice, including PPP-related court decisions and rulings of the antimonopoly authority.

Online Center of Education works as a constructor of online learning courses and a tool for online assessment of employees' competences in PPPs.