Top financial experts from across the region gathered in Dubai to discuss and identify the best possible means to access channels of funding for the ongoing and proposed infrastructure development projects in the region.

The interaction hosted by the Dubai International Financial Centre (DIFC) as part of its DIFC Economics Workshop series, featured top executives from developmental and financial institutions as well as senior DIFC Authority officials on the speakers panel.

Dr Nasser Al Saidi, chief economist at the DIFC Authority, pointed out that the regional economies - and particularly the Gulf countries - are relatively young and unhampered by historic and obsolete technologies that some of the more mature economies face.

"This allows the GCC countries to leap ahead and adopt the most modern technologies, without going through intermediate phases," he noted.

According to Al Saidi, infrastructure investment has been a major driver of economic growth in the Gulf region over the past six years.

"Despite the global financial crisis, there continues to be enormous demand for new infrastructure across the GCC countries and the region driven by population growth, economic development and diversification imperatives as well as the overall aim of being counted amongst the most advanced nations," he added.

According to him, the size of infrastructure projects in the Gulf has currently been estimated at a whopping $2.3 trillion.

"Indeed counter-cyclical fiscal policy has focused on maintaining or even increasing government expenditure on public works and infrastructure,” said Dr Al Saidi.

“Effective financial solutions, the availability of long-term finance and continuous and timely funding are critical to the smooth implementation of new infrastructure projects, and in turn, to the sustained economic growth of the GCC countries and the region,” he explained.

"However, due to the global financial crisis, banks have tightened access to financing limiting funding options," he added.

The DIFC workshop was mainly organised to explore alternative means and methods of financing infrastructure development,” he pointed out.

Some of the alternative means of funding identified by the workshop included Project Financing, Public-Private Partnerships (PPP), Build-Operate-Transfer (BOT) models, Capital market based financing, Housing Finance as well as raising Public Debt and recourse to Islamic instruments such as Sukuk (Islamic bonds).

Apart from Dr Al Saidi, other speakers were drawn from leading banks and financial institutions involved in providing infrastructure finance. The list included Adil Marghub, manager, Infrastructure Cluster at the International Finance Corporation (IFC), Suresh Vasan, director of Energy Financial Services at General Electric (GE) and Frank Beckers, managing director and head of Project & Capital Advisory at Deutsche Bank.

Beckers said, “Given the challenging amounts of financing to be raised for infrastructure developments, we will have to explore all available liquidity pools. This will likely require a more diversified approach towards funding sources compared to the bank loan focused approach we have seen so far."

"However, the strategic nature of most infrastructure developments in the GCC, evidenced also by strong government support, will continue to support those efforts," he noted.

Marghub said the Mena region has been one of the more active regions globally in infrastructure projects, and the underlying fundamentals for an increasing role for the private sector in infrastructure remain strong.-TradeArabia News Service