Home  Journals  Financial Analytics: Science and Experience  26(260) - 2015 July

The world best practices of optimizing infrastructure spending

Vol. 8, Iss. 26, JULY 2015

Article PDF Version

Received: 26 May 2015

Accepted: 1 June 2015

Available online: 26 July 2015

Subject Heading: INNOVATION AND INVESTMENT

JEL Classification: 

Pages: 53-66

Importance The issue of optimizing infrastructure costs has become even more pressing recently especially in developing countries because of the drastic lack of investments in infrastructure development all over the world. The application of the successful world experience in cutting infrastructure costs in Russia will not only reduce deficit of investments in infrastructure considerably, but also improve the competitiveness of the Russian economy and foster its economic growth.
     Objectives The objective of the research is to define the most effective methods for optimizing infrastructure costs. To reach this objective, I analyzed financing of infrastructure development all over the world and in developing countries particularly, examined the methods of cutting infrastructure costs in foreign countries and results of their application. I also assessed the current deficit of infrastructure investments in Russia, identified matters impeding efficient implementation of infrastructure projects in the country as well as possible areas for applying international experience under the current economic conditions in Russia.
     Methods The methodological framework of the article relies upon the analysis of different countries' practical experience in optimizing infrastructure spending.
     Results I identified the most effective methods for cutting infrastructure costs and formulated recommendations on possible application of the best foreign practices in Russia.
     Conclusions and Relevance I conclude that introducing the world best practices into the Russian system for planning, selecting and managing infrastructure projects is of great importance as it will help reduce deficit of investments in infrastructure, improve living standards in the country and contribute to economic growth. The world best practices identified and recommendations for their application in Russia can be used by the Russian authorities in planning, selecting and managing infrastructure projects.

Keywords: infrastructure project, optimization, expenses, effectiveness, finance

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