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Rumblings down under
Research - OCTOBER 13, 2017

Rumblings down under

by Andrew Campbell

A new report from Infrastructure Partnerships Australia and Perpetual, throws cold water on what has long been one of the more attractive markets for infrastructure investment —Australia. The continent remains a destination for infrastructure investors, but the 2017 Australian Infrastructure Investment Report, “shows with clarity that Australia’s solid reputation as an infrastructure investment destination is being eroded, as investors take stock of increasingly unpredictable political interventions, perpetrated by national and state governments.”

The report surveyed 26 domestic and global investors including sovereign wealth funds, pension funds, fund managers, developers, banks and insurance companies with collected assets under management of  collectively more than $220 billion of infrastructure assets across the globe. Of those surveyed, 70 percent will continue to target Australia, but this is a decine of 24 percent from the previous year. 

“Political interventions on projects and unpredictable rule changes see Australia now receiving the type of investor commentary that’s more usually associated with emerging economies,” says Infrastructure Partnerships Australia, CEO Brendan Lyon. “Two thirds of investors are spooked by the Federal Government’s unpredictable policies on energy and other market interventions planned or under consideration. The appetite to invest in South Australia has tumbled by 75 percent to just four per cent of investors, showing that investors will punish jurisdictions who act in poor faith.”

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