The report offers a 5 year view of market potential for investment in road infrastructure, estimating the size and growth prospects of road investment in Canada, United States, and Mexico, including breakdowns by state, province and territory. The report also provides a qualitative assessment of the infrastructure investment climate in North America.
"North American roads, particularly those in Canada, are faced with two major challenges - scarcity and congestion," said Stephen Beatty, partner and head of Global infrastructure for KPMG in North America. " We have used up most of our excess capacity, and now we're faced with either rationing the capacity we have or building new capacity."
The report also finds that four of Canada's provinces - Alberta, British Columbia, Ontario and Quebec - are expected to continue to represent nearly 90 percent of the country's road investment. Leading institutional investors, such as pension funds, continue to be drawn to Canada's large secondary market for infrastructure assets, due in part, to the relatively steady and predictable cash flows they generate.
Canada: forecast cumulative expenditure on roads infrastructure 2009-2013 (US$ billion)
"Canadian institutional investors have historically been among the most sophisticated with regard to infrastructure ventures," said Beatty. "Clearly, they recognize that there are significant benefits to be had by making these investments, both in terms of quality of life as well as maintaining our competitive advantage."
Significant interest persists in alternative funding and development models such as P3/Public Private Partnerships (PPP). Several Canadian road and transit-related projects have been developed as PPPs, with more envisioned for the future.
"As Canada struggles to find ways to fund major, strategic infrastructure projects in the midst of a massive global financial crisis, it's important that we approach the challenge holistically," added Beatty. "It's not about a new bridge here or a toll road there, but how to spend money wisely so the benefits can be enjoyed by subsequent generations to come. These infrastructure investments present both an opportunity and a responsibility that should not be ignored."
KPMG's Trend Monitor: North American Roads looks to offer a medium-term (2009-2013) view of market potential. Analysis is based on data sources and little (explicit) assumptions, and also leverages the local knowledge of professionals in KPMG's North American member firms. The full report can be accessed at www.kpmg.com.
About KPMG's Global Infrastructure Practice
KPMG's Global Infrastructure practice has extensive local and global experience advising government organizations, contractors, operators, and investors in planning, structuring and management of new infrastructure investments; procurement and financing support; improvement and monitoring of construction and operations; restructuring of distressed projects; investment due diligence assistance; and infrastructure related audit, tax, accounting and compliance issues.
About KPMG International
KPMG is a global network of professional firms providing Audit, Tax and Advisory services. We operate in 144 countries and have 137,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss cooperative. Each KPMG firm is a legally distinct and separate entity and describes itself as such.
About KPMG in Canada
KPMG LLP, a Canadian limited liability partnership established under the laws of Ontario, is the Canadian member firm affiliated with KPMG International, a global network of professional firms providing Audit, Tax, and Advisory services. Member firms operate in 144 countries and have more than 137,000 professionals working around the world.
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