What's Happening?
The Inter-American Development Bank Group (IDB Group) and Economist Enterprise's new report, Infrascope 2025/2026, indicates that most countries in Latin America and the Caribbean are increasing their investments through public-private partnerships (PPPs).
The report highlights an improving environment for advancing more PPP projects, with 60% of the IDB Group’s borrowing member countries strengthening their PPP capacities. The regional average score for the enabling environment to develop PPPs rose from 45.4 to 46.5 out of 100. Brazil and Chile are leading the index, with Brazil nearing the 80-point top tier, both showing progress in project preparation. Ecuador, Paraguay, Guatemala, and Belize have also made notable advancements due to regulatory and institutional reforms. Between 2016 and 2025, Latin America and the Caribbean recorded 764 PPPs, totaling approximately $191 billion. The share of tendered PPPs reaching financial close increased to 64% from 60%, and country-risk premiums decreased in 24 of 26 countries.
Why It's Important?
The growing trend of public-private partnership investments in Latin America and the Caribbean is crucial for addressing the region's infrastructure and public service needs. Tomás Serebrisky, manager of the IDB’s Infrastructure and Energy Sector, emphasized that private participation is key to delivering better public infrastructure and higher-quality public services. This shift towards PPPs can unlock significant private capital, reducing the financial burden on public budgets and accelerating development projects. The improvements in regulatory and institutional frameworks in several countries signal a more stable and attractive investment climate for private entities. Increased private sector involvement can lead to greater efficiency, innovation, and improved project delivery, ultimately benefiting citizens through enhanced infrastructure and services. The IDB Group's role in strengthening enabling conditions and structuring innovative projects is vital for sustaining this positive momentum.
What's Next?
The IDB Group plans to continue supporting countries in closing gaps in their PPP frameworks, with the IDB assisting with upstream PPP public-policy reforms and project preparation, and IDB Invest potentially supporting financial close. By the end of 2026, the IDB’s PPP advisory work across the region is projected to mobilize $6.8 billion in private infrastructure investment, with an estimated $1.95 billion in 2026 alone. Twelve new mandates signed this year could attract an additional $3 billion, and the active pipeline is expected to mobilize a further $10 billion in private investment by 2030. These efforts underscore the critical role of project preparation in converting infrastructure needs into viable investment opportunities. Continued monitoring through reports like Infrascope will be essential to track progress and identify areas for further improvement in the region's PPP landscape.
Beyond the Headlines
The increasing reliance on public-private partnerships in Latin America and the Caribbean reflects a broader global trend towards innovative financing models for development. This approach can foster greater collaboration between governments and the private sector, potentially leading to more sustainable and resilient infrastructure. However, it also raises questions about governance, transparency, and equitable distribution of benefits, as private sector involvement can sometimes lead to concerns about public accountability and affordability of services. The success of these partnerships will depend on robust regulatory oversight, clear contractual agreements, and a commitment to social and environmental safeguards. The IDB Group's emphasis on strengthening the enabling environment suggests an awareness of these challenges, aiming to ensure that PPPs contribute positively to inclusive and sustainable development.
