Sie sind auf Seite 1von 16

PUBLIC PRIVATE PARTNERSHIPS

Taking a Balanced Look.


Development Equity Associates Inc.
Nov. 14, 2012
1
PUBLIC PRIVATE PARTNERSHIPS
AGENDA
What are PPP transactions
Why and When to do them
How are they done
Some Examples Good and Bad.
The Key lessons to remember
Future Outlook for PPPs.

Development Equity Associates Inc.
Nov. 14, 2012
2
PUBLIC PRIVATE PARTNERSHIPS
What they are
Development Equity Associates Inc.
Nov. 14, 2012
3
Agreement between Government and the Private
Sector for the Provision of a Public Good or
Service by the Latter.
Generally but not always involving:
Long Term Contracts
User Charges and/or Payments flowing between the
Parties
Shared Investments but Mainly Private
Risk Sharing by the Parties
Must be a Partnership

PUBLIC PRIVATE PARTNERSHIPS
What they are
Development Equity Associates Inc.
Nov. 14, 2012
4

Source: European Commission
PUBLIC PRIVATE PARTNERSHIPS
Why do them.
Development Equity Associates Inc.
Nov. 14, 2012
5

Fiscal Head Room
As a Way of Financing the Project
Separate Policy & Regulation from Operations
Make the Good or Service Available
Pay for Performance and Output
Introduce Competition For and In the Market
PUBLIC PRIVATE PARTNERSHIPS
When to do them.
Development Equity Associates Inc.
Nov. 14, 2012
6
Source: Vikram Kutaree World Bank
PUBLIC PRIVATE PARTNERSHIPS
When to do them.
Development Equity Associates Inc.
Nov. 14, 2012
7

Benefits
Economic Growth and Employment
Other Social Benefits
Impact on the Poor

Ease Of Implementation
Political Support & Lack of Resistance
Technical Feasibility
Financial Viability
Public Support







B
E
N
E
F
I
T

T
O

C
O
M
M
U
N
I
T
Y




EASE OF IMPLEMENTATION

1
3
2 4
Prioritization
Political Economy
2
3
PUBLIC PRIVATE PARTNERSHIPS
How to do them.
Development Equity Associates Inc.
Nov. 14, 2012
8
Project Identification
If it aint broke dont fix it !
Pre Feasibility
More than back of the envelope do this first !!
Go NoGo here
Public Relations Program A must !
Feasibility Study
Only if needed for the RFP
Agree Regulatory Framework
RFP Design
Technical Pass Fail & Selection on Financial bids
Include Draft Contract
Include Surrogate regulations if needed with Phase out.
PUBLIC PRIVATE PARTNERSHIPS
How to do them.
Development Equity Associates Inc.
Nov. 14, 2012
9
Implementation Institutional Arrangements
Preferably before tendering!
Must have Transition Plan
EOI & Tendering
ICB Best for Large Projects
Selection, Negotiations and Contract
Financial Closing
Implement Regulatory Framework
PUBLIC PRIVATE PARTNERSHIPS
Examples The Good & Not So Good
Development Equity Associates Inc.
Nov. 14, 2012
10
The Good

Roads Chile
Urban Public Transport
- Jordan, Bahrain
Water Supply Bucharest
Romania

The Not So Good

Roads Mexico
Solid Waste Collections
- Bahrain
Municipal Parks Sophia Bulgaria
Water Supply Mumbai, India
PUBLIC PRIVATE PARTNERSHIPS
Key lessons to remember
Development Equity Associates Inc.
Nov. 14, 2012
11



Legal & Regulatory Framework

Tariff Regimes

Avoidance of Fate Control

Competition a Must !!


Balance in Private Incentives & Public Interest
LEGAL & REGULATORY FRAMEWORK FOR PPP


Private Incentives Public Interest
PUBLIC PRIVATE PARTNERSHIPS
Key lessons to remember
Development Equity Associates Inc.
Nov. 14, 2012
12

What is the Sector Priority ?

In Transaction Design
Incentives and Penalties
Length of Contract
Risk Allocation

In Regulatory Strategy
Tariff Regime
Competition
Institutional Structure




The Need to Set the Right Priorities
PUBLIC PRIVATE PARTNERSHIPS
Key lessons to remember
Development Equity Associates Inc.
Nov. 14, 2012
13
Budget Rationale vs. Present Value Test
PUBLIC PRIVATE PARTNERSHIPS
Key lessons to remember
Development Equity Associates Inc.
Nov. 14, 2012
14
Average Time to Renegotiation

1.5 to 3.5 Years Depending on Sector
The Common Causes:
Bidders Remorse
Strategic
Additions after Award
Winner is Stronger Position



Some Remedial Measures
Adequate Escalation Clauses
Right to Re-Bid ( e.g., O&M)
Conditions & Penalties
Renegotiation !!!
PUBLIC PRIVATE PARTNERSHIPS
OUTLOOK
Development Equity Associates Inc.
Nov. 14, 2012
15

Greenfield and Energy PPPs will continue
to Dominate

South Asia likely to remain the main
growth Area for PPPs.

Worldwide PPPs are likely to pick up as
Fiscal Headroom lags Demand Growth
PUBLIC PRIVATE PARTNERSHIPS

Development Equity Associates Inc.
Nov. 14, 2012
16



THANK YOU