CAN private finance plug the high-speed funding gap? The European Commission (EC) certainly hopes so. The High-Speed Rail Action Plan published in November 2025 calls on the private sector to play a significant role in financing projects across the continent in the coming years. The goal is to develop a network that will support speeds of 250km/h and above between major cities, slashing journey times and increasing the attractiveness and viability of rail against short-haul aviation on cross-border services.
Delivery of this vision will require both new construction and upgrades to existing infrastructure across the TEN-T network. The EC’s action plan puts the estimated cost at €546bn for the comprehensive TEN-T by 2050 and €345bn for the 51,000km core TEN-T by 2040. In return, the enhanced network is estimated to generate an economic payback to society of €750bn. Reducing pollution and greenhouse gas emissions as well as easing road congestion are obvious benefits. Infrastructure upgrades across the TEN-T are also the silver lining of the sobering need to make it easier to move military equipment by rail.
As my in-depth feature reveals, there is a strong appetite among the banking community to support rail. I spoke with the European Investment Bank (EIB), which describes “connecting people and countries” as one of its core principles. Equally, Dutch commercial bank ING likes rail because its sustainability credentials align with its objective of supporting green transport. Yet both banks identify several challenges that may prevent them from putting their cash into rail projects.
Encouragingly, the EC is attempting to address many of these issues. We report this month on the publication of the Passenger Mobility Package, which aims to simplify the process of booking tickets for cross-border rail journeys, which will make rail more accessible and attractive. The European Parliament also passed the revised Capacity Management Regulation as this issue went to press, which will offer a new framework to support long-term capacity planning and path allocation, improving the coordination of cross-border services and improving the flow of international passenger trains and freight services.
In addition, in its high-speed action plan, the EC has vowed to set binding targets to remove cross-border bottlenecks, develop a second-hand market for rolling stock, and introduce binding targets to accelerate the deployment of ETCS. It will also add some meat to the bones of its financing strategy for the network in the upcoming High-Speed Rail Deal, which is due by the end of the year.
This will undoubtedly consider the various ways of adopting public-private partnerships (PPP) to deliver high-speed rail projects, hopefully learning from past projects that have not quite delivered. KfW-IPEX Bank of Germany is touting Engineering, Procurement, Construction and Financing (EPC-F) as a model suited to rail infrastructure projects, particularly in eastern Europe. Yet the overarching message from these financiers is that projects need certainty if these financing structures are to work. After all, they are in business to achieve a return within a reasonable timeframe. Adequate up-front planning to work through potential issues is therefore essential to demonstrate a project’s commercial viability. The banks say it is no coincidence that successful projects take many years, even decades, to leave the drawing board. Consistent political support for the duration of a project, not just a term of office, is also essential.
This lesson about careful and considered planning of rail projects does not only apply to Europe. As our recent feature argued, even in high-risk markets such as Syria and Libya it is possible to access private finance for elements of a project if they are properly considered. Rail is the most promising means of unlocking reserves of natural resources in these countries, which is deemed essential to their economic recovery. Identifying a commodity, a suitable corridor, reliable local partners and keeping the network open to a pool of prospective operators enhances the bankability of these projects and gives them a better chance to succeed.
This appears to be the model emerging in sub-Saharan Africa where the desire to connect new mining sites with ports, and the need to improve transport networks in general, is driving a wave of new rail projects.
Trans-Guinean Company (CTG) is on course to open by the end of the year a new 650km line that will carry up to 120 million tonnes of iron ore annually from deposits at Simandou to a new port at Morebaya. The line will be open for use by a variety of operators and CTG is now exploring passenger services on the line that will serve 10 stations.
Tanzania and Uganda also recently confirmed respective multi-billion-dollar financing deals with Standard Chartered and Citibank to support their Standard Gauge Railway (SGR) projects (p14 and 15). This is especially encouraging given previous mixed experiences with Chinese finance, which did not necessarily offer sufficient levels of project scrutiny for SGR schemes.
Returning to Europe, and unfortunately Britain’s HS2 project has offered another stark reminder of how not to build a high-speed railway. The costs and timelines for the London - Birmingham line have slipped again, a new review of the project has revealed. One of the review’s most eye-catching observations was that design on some sections was just 10% complete when construction got underway in 2020.
What was supposed to be the fastest and most sophisticated railway in the world when it was conceived has become an example the rest of the world should not follow. The worry here is that the HS2 saga of mounting delays and escalating costs will prevent similar projects from being built in Britain. Experience shows that it is possible to successfully execute major projects, and even attract private finance to help do so. But success is very much dependent on long-term planning and consistent political support. Other projects would be wise to take note.
