There is a growing interest in building urban transportation infrastructure across the developing world. Many policymakers are currently drafting ambitious transportation plans that implement new systems and build infrastructure.

A key hurdle to the implementation of major transportation projects is funding which often costs billions of dollars and requires policymakers to decide how a piece of infrastructure is funded.

This brief provides an overview of the three most important policy questions associated with transportation finance and project delivery: How is transportation infrastructure paid for? Do transportation projects make money? What are the financial implications of inaccurate cost and revenue forecasts?

The author concludes that these questions require careful consideration in order to prevent infrastructure never being built or saddling governments with long-term debt that can result in future budget crises.