Project financing is a form of funding through which public administrations can use private capital to implement projects and infrastructures for the use of the community. In other words, the costs for the realization of a public work can be totally borne – in case of pure project financing – or partially by private individuals.
Project financing, borrowed from our legal system by the Anglo-Saxon system, is usually carried out by a tender, generally with the promoter formula provided by art. 183 paragraph 15 of Legislative Decree no. 50/16.
The benefits of this collaboration between public and private are reciprocal.
Public administrations can carry out important and often necessary interventions, otherwise they are not allowed by budget availability. The private investor, on the other hand, obtains the concession for the economic exploitation of the work realized.
The realization of a work can only take place after an estimate by credit institutions that examines the real capacity of the project to be profitable. Principal evaluation of the costs of implementation and the future user basin of the work are being evaluated. In addition to its usefulness, the work, once accomplished, must ensure effective profitability.
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