Public Infrastructure Investment and Fiscal Sustainability in Latin America Incompatible Goals? / [electronic resource]:
Luis Carranza, Christian Daude and Ángel Melguizo
- Paris : OECD Publishing, 2011.
- 41 p. ; 21 x 29.7cm.
- OECD Development Centre Working Papers, no.301 18151949 ; .
- OECD Development Centre Working Papers, no.301. .
Latin American countries exhibit a significant gap in infrastructure stocks, due to low and in many cases inefficient public investment, which is furthermore not compensated by private sector projects. In this paper we analyse trends in public and total infrastructure investment in six large Latin American economies, in the light of fiscal developments since the early eighties. We argue that post-crisis fiscal frameworks, notably fiscal rules which are increasingly popular in the region, should not only consolidate the recent progress towards debt sustainability, but also create the fiscal space to close these infrastructure gaps. These points are illustrated in a detailed account of recent developments in the fiscal framework and public investment in the Peruvian case.