Foreign Direct Investment in Cross-Border Infrastructure Projects

In this paper we critically review the relevant information and literature and that can enhance the feasibility and the successful implementation of cross-border infrastructure projects. We provide detailed information concerning FDI into the major emerging regions: East Asia/Pacific, Latin America and Eastern Europe. We also discuss the theoretical and empirical literature which sheds light on the characteristics of transnational infrastructure projects, who should conduct them and what determines their existence. The literature points to the importance of governments to be involved in transnational infrastructure projects as there are clear externalities which will otherwise not be reaped. It also points to the importance of coordination for the project to be successful. The ADB is well placed to perform that role. Lastly we provided a total of six cases of cross-border infrastructure projects, with two from East Asia, two from Latin America and two from Eastern Europe. These cases illustrate the critical need for smooth coordination over the diverse groups of team players, a top-level backing of the projects as well as a thorough understanding of all the political and financial factors involved that can influence the success of these projects