A project report submitted in partial fulfilment of the requirements for the degree of Masters of Management (Finance and Investment) in the Faculty of Commerce, Law and Management Wits Business School, University of the Witwatersrand, 2016 / It is well acknowledged that infrastructure provision is linked to economic growth , in particular airports are viewed a strategic catalysts to this growth bringing about increased opportunities for trade, tourism, and serving as an enabler for business. African airports have historically suffered underinvestment as a result of competing priorities for government funding; growing safety concerns, increased traffic growth and globalisation, and the need for refurbishment and modernisation of systems. African nations are now beginning to spend considerable amounts on aviation infrastructure. The purpose of this study evaluate the financing mechanisms available to governments, to access the role that airport economic regulation plays in attracting investment and the potential of leveraging the securitisation model for the financing of aviation infrastructure. It was found that, no one funding mechanism is king and that airport owners and operators should attempt a diversification strategy towards their funding sources, taking into account that the investment appetite of various investors will be different at the various phases of infrastructure project delivery. It was found that airport regulation is key to harnessing the certainly of future cash flows required by private investors , and may be the required mechanism to off load the financial burden of smaller airports from the government budgets. Lastly it was found that development finance institutions may be the biggest benefactors to utilising the securitisation model to unlock further developmental funding; key to this is the support of institutional investors. / XL2018

Report submitted in partial fulfilment of the requirements for the degree of Master of Management in Finance and Investment Faculty of Commerce, Law and Management Wits Business School University of the Witwatersrand Johannesburg, South Africa / The development of transportation infrastructure, including airports, plays a vital role in economic growth in emerging markets. However, government budget allocations for this purpose are often insufficient to realise the full benefits. Project finance and Public Private Partnerships (PPPs) in particular, have been used to enable private sector participation in the financing of airport development. Airports PPPs have successfully been implemented worldwide, including, to a lesser extent, in emerging markets and Sub-Saharan Africa (SSA). There is a lack of literature on the benefits, risks, challenges and opportunities associated with airport PPPs in SSA, which this research aims to address. Case studies of recent airport PPPs in Brazil and India provide an outline of the emerging market context and insight into factors that affected these airport PPPs. In-depth interviews with two representatives of governments in SSA provide a rich view on the perceived benefits, risks, challenges and opportunities associated with airport PPPs in Africa. This research has found that airport PPPs can contribute to airport developments in SSA by enabling the private funding of airport upgrades and expansions. However, governments have an important role to play in providing an enabling environment for private investors by improving investability and implementing clear and practical PPP legislation, aviation policies and economic regulation of airport services. The limited institutional capacity and domain expertise of SSA governments is perceived as a challenge to the implementation of airport PPPs in the region. The low level of air traffic and small number of airports that handle more than one million passengers per annum further limit the opportunities for airport PPPs in SSA, although strong GDP growth provides an encouraging sign. Successful airport PPPs require the participation of private consortia with expertise in airport operations, construction and infrastructure concessions. Financing of airport PPPs is done preferably from domestic sources and development finance can play an important role. There are risks associated with the foreign ownership of key national infrastructure and a reliance on private sector to provide public infrastructure. Lighter forms of PPPs that limit the private sector risk exposure may be more suitable to the low-traffic and high-risk environment in SSA. / MT2017