Natalia Diatlova told the Novy Prospekt about the impact of coronavirus on the implementation of PPP projects in the healthcare sector

Italian construction company Pizzarotti is going to withdraw from the 6.9 billion rubles project of № 40 Hospital reconstruction which was planned on the basis of PPP.  According to market participants, the decision is caused by systemic difficulties associated with the implementation of large medical PPP projects; primarily the difficulty of return on investment due to low tariffs for services under the Compulsory Health Insurance. In addition, the situation was aggravated by the coronavirus pandemic.

Natalia Diatlova, Partner, Head of PPP Practice at Maxima Legal told the Novy Prospect online media, that investments in PPP projects in the healthcare sector collapsed against the backdrop of the pandemic, and investors have recently given the preference to the cheapest and low risk projects.  “In general, the infrastructure projects market rolled back: there was a serious drop in consumer demand, the country government had to reorient itself from supporting infrastructure projects to other sectors of the economy. Both currency and inflation risks played a role,” Natalia added. In this regard, PPP projects in the healthcare sector, directly dependent on consumer demand and imported equipment and materials, were severely affected, the expert concluded.

To read the article (in Russian) in full, please see the Novy Prospekt website >>>