Dasom Hong
pages: 1-18;
JEL classification: R00;
Keywords: Financial geography, financialization of infrastructure, state-owned enterprise;
Abstract: The financialization of infrastructure has emerged as a resolution for alleviating government budget
pressures derived from chronic underinvestment in infrastructure and post-global financial crisis
recession. Two interrelated phenomena are considered central features of the financialization of
infrastructure: the transformation of infrastructure into an alternative asset class and the growth of
public–private partnerships (PPPs) in infrastructure development. In particular, the expansion of
global PPPs has attracted the attention of various entities, including state-owned enterprises (SOEs).
Recently, SOEs have participated in foreign infrastructure PPPs as private sector entities. Unlike conventional private sector involvement in infrastructure PPPs, SOEs aim to achieve public objectives
and mobilize both public and private resources to enhance competitiveness within the global PPP
market. In this paper, the specificities of SOEs participating in foreign infrastructure PPPs and their
implications for the financialization of infrastructure are analyzed using a South Korean SOE: Korean
Overseas Infrastructure and Urban Development Corporation (KIND). This reveals why and how SOEs
engage in foreign infrastructure PPPs via the drivers and business strategies of KIND. Moreover, it
examines infrastructure PPPs managed by KIND to reveal how the business strategies of KIND work
in practice. Consequently, this paper suggests that SOEs engaging in foreign infrastructure PPPs
attempt to achieve policy objectives through the production and financialization of foreign infrastructure. In the process, SOEs actively take advantage of entities and resources from both the public
and private sectors.