This presentation was made by Dimitrios Dimitriou, Athens International Airport, at the 10th annual meeting of the OECD Network of Senior PPP and Infrastructure Officials held at the OECD Headquarters, Paris, on 21 March 2017

1. Dr. Dimitrios J. DIMITRIOU
Planning, Management & Economics in Transport Infrastructure Development
Professor Asst, Dept. of Economics, DUTh, Greece
Chairman BoD, Athens International Airport
2nd OECD Forum on Governance of Infrastructure and
10th Annual Meeting of the OECD Network of Senior PPP and Infrastructure Officials
Paris – March 2017
Session: Mega Projects - why are they difficult and what can be done about it?
Defining decision making equilibrium for mega
transportation projects

2. Presentation outline
 Key variables of transport demand growth
 Transport trends and prospects
 Transport economic footprint and decision making
 Needs, objectives and methodology framework to estimate transport
infrastructure economic effects
 Types, outputs and mechanism of economic development impact
 Case studies and highlights on economic contribution of mega infrastructure
development in various regions
 Discussion issues and concluding remarks to industry and investors
 Further Research
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Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure

3. Demand drivers
33
Source: OECD, 2012
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Source: Dimitriou, ACI 2016

4. World Airport Connectivity trend in EU-non EU in terms of airline capacity, (2005-2016)
Source: ACI , 2016
Connectivity in European hub airports (change 2008 vs 2016)
Connectivity trends and prospects - Europe
-6
-4
-2
0
2
4
6
8
10
12
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
EU
Non-EU
19.7%
22.5%
26.8%
25.4%
21.1%
65.6%
39.5%
Intra-Europe
Europe-North America
Europe-Asia Pacific
Europe-Latin America
Europe-Africa
Europe-Middle East
Intercontinental
44
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
ProfessorAsst– Planning Management and Economics in Transport Infrastructure

5. A. Transport Infrastructure Industry Expectations
Expectation differencing for Key Challenges
- Carriers -Win-Win situation
- Infrastructures -Power game
- Authorities - Business/Social Equilibrium
B. Investments and Business Development
Key Strategies Key Challenges
- Concession projects - Project financing
- Attract investor’s - Condition of contracts
- Market expectations - Regulation
Transport infrastructure industry challenges 1/2
5
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Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure

6. C. Tools Influencing Demand
Key Strategies Key Challenges
- Pricing policy - Supply – Demand dilemma
- Connectivity - Capacity – peak hour problem
- Demand patterns - Incentives
D. Mega infrastructures as a ‘private’ Company
Key Strategies Key Challenges
- Efficiency (operation) - Competition
- Demand growth (profitability) - Merge - acquisitions
- CSR (sustainability) - Marketing
E. Management
Key Strategies Key Challenges
- Risk sharing - Unit cost
- Business control - Capacity/Utilization
- System of System approach - Employees - talent
Transport infrastructure industry challenges 2/2
6
66
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure

7. •Government
•Authorities
Strategic
Planning
•Banks
•Investors
Financials
• Ministries
• Construction
agents
Construction
Carriers
Operation
Ensure that the project is developed in a
manner that promotes national economic
development
Promote financial Stability and compliance
with laws and regulation
Prevent monopolistic actions
Provide the best interests for tenants
Engineering and Construction contractor
monitoring
Performance management of resources
and cost
Promote safety and security
Operation efficiency and lab our stability
Ensure efficient operations
Earn high return on investment
Appropriate balance between equity and
debt to maximize returns
Maximize the value to all stakeholders
SoS for investment in transport infrastructure
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Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2016, IJCEE, 10(10)

8. Airports contribution in European Economy
62.7 million jobs supported
2.7 trillion USD Global economic impact
Represent the 3.5 % of global GDP
Aviation jobs 3.8 more productiive than other jobs
12.3 million associated jobs
674 bio Euro, European economic impact
Represent the 4.1 % of national GDP
Source: IATA, 2016
Source: ACI, 2015
88
Airports contribution in economy
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Airports contribution in Global Economy

9. Transport Infrastructure Corporate Decision Making Equilibrium
9
 Competitiveness
 Regulatory framework
 Monitoring/Review performance
 Analysis of the competition
 Innovation
 Products - services
 ITS
 Smart business
 Research
 Strategy
 Development of Tourism market
 Market regulation - protection
 Funding - new investments
 Social impact and CRS
 Planning
 New Infrastructure
 Business Sustainability
 Business Development
 Social benefits return
Supply
DEMAND
99
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2017, IJESRT, 6(1)

10. Business environment and
investment conditions
Income per Capita
Transport business
Working conditions Expertize
and product recognition
Working force capital
Inflation-Consumer Prices
Currency exchange rates
Import/Export Volume
Demandside
Variables
A
Socioeconomic
valuesandDecision
parameters
B
Supplyside
Variables
C
Transport Cost
Travelers environment
sensitivity and awareness
Region attractiveness and
accesibility
Transport System Capacity
Network connectivity
Ligable assets and capitalsTransport Assets Portfolio
Network efficiency and
Productivity
Inligable and Natural capital
Cultural Capital
Environmental Capacity
Constraints
Quality of life values and
expectations
Stability –Security
Education and Health
Ecological sensitivity
Society Isolation
Demand /Supply variables influence decision making
Social valuesEconomy conditions
1010
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2016, IJSBEEBIE, 10(11)

11. INPUT EVALUATION - DECISION RESULTS (OUTPUT)
Operation
characteristics
Operator
performance
Travel Demand
Drivers
Network Evaluation
→ Competition (carriers, fares)
→ Robustness (scheduled)
→ Saturation (new routes)
Business Sustainability
→ Carriers
→ Infrastructure Operator
→ Capacity / Efficiency
Economic Productivity
→ Demand patterns (expenditure at city)
→ Transfer pax
→ Contribution (regional economy)
Infrastructure projects
Social values
Economy conditions
Decision agents and
Stakeholders and
perspectives
Operation
characteristics
Operator
performance
Network planning
Decision objectives
Taxonomy to evaluate transport infrastructure investment
1111
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2017, IJESRT, 6(1)

12. Activity Impact Assessment - General Framework
Socio
economic
Analysis
Risk
Assessment
External
Financial
Analysis
Internal
Financial
analysis
12
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Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2017, IJESRT, 6(1)

13. 13
1313
Key question in strategic planning and decision making
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2017,Research Project
Financial
analysis
Added value to
Economic System
Equilibrium??

14. Strategic planning and DSS
What will be the ripple effects
across the Regional Economic
System?
What is the Region
Economic Base
How many jobs will be
gained?
How much total Output
will be gained?
14
1414
Key questions in strategic planning and decision making
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure

15. 15
`
Direct Indirect
Induced
Sector
Multiplie
Income
per sector
Sectors
Transaction
tables
Wages per
sector of
activity
Macroeconomic
features of the
project
catchment area
Jobs per
sector Catalytic
Direct
Multiplied impact
Indirect Induced Catalytic
New demandfrom
additional capacity
Jobs distribution for
each project phase
Project financial features and
technical characteristics
New Jobs
New Income
1515
Methodology framework
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al.2015, IJAE,47(40)

16. 0
1
2
3
4
5
6
7
8
CYPRUS
MALTA
GREECE
LUXEMBURG
PORTUGAL
SPAIN
IRELAND
DENMARK
NETHERLANDS
CROATIA
SWEDEN
FINLAND
UK
FRANCE
BULGARIA
BELGIUM
POLAND
GERMANY
ITALY
AUSTRIA
SLOVENIA
CZECH
LATVIA
ROMANIA
SLOVAKIA
LITHUANIA
ESTONIA
HUNGARY
DIRECT/INDIRECT/INDUCED
CATALYTIC
16
1616
Contribution of Air Connectivity in European Countries as share of National GDP
Highlight on Economic contribution of air connectivity in EU-28
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Source: ACI, 2016

17. 3.94 9.94
17
88,700
271,700
2.2%
National
GDP
Direct/ Indirect
Induced
Catalytic
Employment Direct, Indirect and Induced Catalytic
GDP(Billions)
5.5%
National
GDP
G
R
E
E
C
E
3.11 7.46
P
O
R
T
U
G
A
L
84,200
204,100
Direct/ Indirect
Induced Catalytic
1.9%
National
GDP
4.5%
National
GDP
GDP(Billions)
Direct, Indirect and Induced
Catalytic
1717
Case Study: Air Connectivity Economic Impact in Remote tourist destinations
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Source: ACI 2016, Author analysis

18. 18
-10
-5
0
5
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
annualgrowthrate(%)
Real GDP forecast, annual growth rate (%), 2009-2018
OECD GREECE EA15
-30
-20
-10
0
10
20
30
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
annualgrowthrate(%)
Investment forecast, annual growth rate(%), 2005-2018
OECD GREECE EA15
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Source: OECD, 2016
Source: OECD, 2016
Case studies: Τransport Infrastructures in Greece

19. 19
8.3 8.5 7.5 6.8 7.5 7.3 8.4 9.6
35.3 36.1
31.9 28.9 31.9 31.0
34,5
38,5
223.2
233.2
231.1 222.2
208.5
193.7
181.1 181.2
100
120
140
160
180
200
220
240
0
10
20
30
40
50
60
70
80
90
100
2007 2008 2009 2010 2011 2012 2013 2014
EuroBio
GDP
Direct Income by Tourism
Income contribution of Tourism
Current prices
1919
1919
Case study: Αir Transport Economic Impact in Greece
Air Transport economic impact in Greece
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Dimitriou et al., WCTR 2016

20. 20
Hub airport
New airport
investmenrt
EUROPE
2020
Case Studies: Mega transport infrastructures in Greece
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
Professor Asst– Planning Management and Economics in Transport Infrastructure
Concession
Motorways
Rail line upgrade in
North Greece
Ports
privatization 14 concessioned
airports

21. 21
 Why to estimate mega transport infrastructure impacts in national/regional economy?
 Estimate the overall contribution in an economic system (regional – national scale)
 Estimate the economic impacts on other economic sectors
 Provide essential economic and social outputs for a variety of stakeholders
involved in decision process (such as Government; authorities; NGOs, etc)
 Monitoring the productivity and the efficiency of transports in economies
 How to estimate mega transport infrastructure impacts in national/regional economy?
 I-O and CGA methodology approach
 High need for data
 Outputs in terms of income and jobs
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Concluding Remarks 1/2
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
ProfessorAsst– Planning Management and Economics in Transport Infrastructure

22. 22
 How significant are the transport infrastructure impacts in national/regional economy?
 Quick and HIGH impacts in unemployment and business growth
 Income multiplier 2 ÷ 5
 Act as un FDI providing additional economic benefits to the poorest regions
 GDP contribution up to 15 %
 Significant higher (direct/indirect effects) if investments are implemented
 Other sectors of development?
 Tourism, Energy, Real estate, Trade and Commission services are the top sectors
of growth + construction
 Provide new opportunities to other economic sectors (e.g. education)
 Ensure social stability and culture exchange
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Concluding Remarks 2/2
Dimitrios J. DIMITRIOU, OECD, Annual meeting on PPP: Mega Infrastructure projects, Paris, 2017
ProfessorAsst– Planning Management and Economics in Transport Infrastructure

23. Dimitrios J. DIMITRIOU
Planning, Management & Economics in Air Transport
Professor, Dept. of Economics, DUTh, Greece
Chairman BoD, Athens International Airport
2nd OECD Forum on Governance of Infrastructure and
10th Annual Meeting of the OECD Network of Senior PPP and
Infrastructure Officials
Paris – March 2017
Thank you
ddimitri@econ.duth.gr