In Troublesome Construction, economist Pitou van Dijck and policy-maker Simon den Haak provide an analysis of the Initiative for Regional Infrastructure Integration in South America (IIRSA). While the book faces limitations due to its predominantly economic approach and focus on one case study, it provides a much-needed account of a large-scale system of projects that will have massive global ramifications.
A critical contribution of the text is the overview of IIRSA, which promises to be one of the most ambitious transnational projects ever planned in South America. Twelve South American countries agreed on IIRSA in 2000 in order to develop an infrastructure which would facilitate trade across national borders continent-wide. The primary intention is to make regulatory and institutional frameworks for transport, energy and telecommunications consistent across boundaries. IIRSA's rationale is based on the need to move beyond the remedying of trade boundaries and trade liberalisation in order to integrate Latin America into global markets, including both north-south and south-south trade relations. More specifically, the projects include roads, bridges, ports, tolls, customs facilities and telecommunications.
While these projects have an immense capacity to spur development leading to increased South American competitiveness in international markets, there is little doubt they will result in negative environmental and social impacts. The Public-Private Partnerships (PPPs) being planned to meet the economic needs of IIRSA also incorporate mechanisms meant to resolve these potentially conflicting outcomes. PPPs take the form of long-term contractual agreements between the private and public sectors, where a combination of services are bundled together and the involved parties have shared financial investment. Much of the funding will be provided by state governments or regional banks such as the Inter-American Development Bank or Andean Investment Corporation. As the authors suggest, other outside investors may also be interested in funding projects in order to reap benefits from access to public goods and trade opportunities.
Dijck and den Haak focus on the role of these PPPs and, in particular, on the Mato Grosso state road-building programme and BR-163, a highway that spans the distance between Cuiaba and Santarem. The Programa Estadual de Recuperacao de Rodovias is the first state-level partnership, and its purpose is to pave roads in order to facilitate export of soya, otherwise known as ‘green gold,’ and other agricultural goods. A series of legal and governmental developments have led to the current bureaucratic structure facilitating these projects. This case study is possibly the most comprehensive and detailed in existence, and accounts for very recent developments. As the authors recount, the projects have been partially studied and planned, and are currently in a state of financial and political freeze.
Although the authors ignore many of the potential impacts of IIRSA in order to discuss its legal and technical framework, they do recognise that estimating the environmental outcomes of the plans is beyond the capacity of cost-benefit analyses and Strategic Environmental Analyses (SEAs). In response, they pose questions about alternative price mechanisms for valuing natural resources, simultaneously recognising that such an approach is methodologically complicated, in particular because of the political economy involved in decision-making.
This analysis and the author's suggestions for improvement are contradictory in one important sense. While the authors claim that the governmental mechanisms used to evaluate IIRSA projects are limited and problematic, the study's predominant focus on economic evaluation limits possibilities for expanding and ameliorating the very problems delineated in the analysis. Overall, the authors take a somewhat analytical approach by raising several problematic elements, but there is little analysis of the benefits and drawbacks of IIRSA overall. One of the greatest weaknesses of the text is its underplaying of the role of political economy in the development of IIRSA or the populations that will be affected by it. In addition, there is little mention of the concomitant environmental problems and social processes which may interact with or affect IIRSA. Instead, the plan is discussed in isolation of the very structural and normative elements that are in part responsible for its creation. Possibly in part due to this weakness, there is little data to support the authors' conclusion that, ‘PPPs are promising instruments to improve the efficiency of public investments in infrastructure projects’ (p. 80).
The important pluses of the text include a detailed overview of the technical and legal aspects of how IIRSA is being developed and will be managed, an in-depth review of the Brazilian structure for PPPs, and a comprehensive history and critique of the Mato Grosso state road-building programme. These are important contributions to scholarship on the politics and economics of development in Brazil. IIRSA is an understudied phenomenon that promises to have massive economic, social and environmental ramifications. Troublesome Construction should represent only the initial steps of a much broader and deeper research trajectory geared toward understanding the processes and long-term impacts of IIRSA on Latin America and the rest of the world.
