CHINA: Technical Assistance to Improve Municipal Financing in Hunan Province

This SNTA-funded activity focused on municipal finance in China with a particular attention to the financing of operation and developments/investments. It also aimed at learning on PPP practices and opportunities in the context of municipal infrastructure financing. The work generated knowledge on municipal finance systems in a pilot Chinese city as it transitions to a new legal and regulatory environment, and identified ways to enhance the financing capacity and management of the city government. A preliminary evaluation of China’s PPP program (that only started in 2014) was added to the work and four PPP case studies were analyzed. The activity allowed to build some of the fundamental principles allowing sector reforms (including VfM analysis and competition in particular) in sectors such as urban transport, where it is expected that potential concessionaires would be able to compete to obtain rights of station area commercial development as part of the operation concession agreement. It is also expected that international operators would be able to participate and compete in China’s metro rail PPP projects.