Romania’s infrastructure spending to reach USD 30 bln a year by 2025

Romania’s infrastructure spending will grow on average by 5% per year between 2013 and 2025 and should reach around USD 30 billion by 2025, according to a report from PwC and Oxford Economics. “Romania’s infrastructure, especially transport infrastructure, is still in much need of improvement, which explains the substantial increase in roads spending in recent years. We expect road spending to continue as a priority during the European economic recovery. Aided in part by EU funding, investment in roads is forecasted to continue to take the lion’s share of transportation investment, rising from USD 4.5 bln in 2013 to just shy of USD 9 bln by 2025,” said Daniel Anghel, Tax Partner, Leader of the Service Team for the Public Sector, PwC Romania. PwC also expects investment to rebound in the infrastructure for chemicals, metals and fuels sectors, almost doubling from USD 2.3 billion in 2013 to USD 4.5 billion by 2025. Social spending will likely also be a priority, with healthcare spending growing by around 0.5% a year faster than education spending as Romania’s population ages, the report shows. Total social infrastructure spending is expected to reach USD 10 billion a year by 2025. “In order to consolidate and accelerate its economic growth, Romania will require massive investments in infrastructure in the coming decade, in the order of tens of billions of euros,” said Daniel Anghel. “In order to finance such large investments, public authorities should take into account a wide range of financing structures – from European funds to Public-Private Partnerships. We should try to emulate the Spanish model that put to maximum use concessions for infrastructure development. We also need multiannual budgets capable of provide long term funding for ongoing infrastructure projects”, he added. Worldwide, infrastructure spending will grow from USD 4 trillion per year in 2012 to more than USD 9 trillion per year by 2025, shows PwC’s and Oxford Economics’ report Capital project and infrastructure spending: Outlook to 2025. The full report can be found here. Andrei Chirileasa, andrei@romania-insider.com