ABIDJAN, March 17, 2010 – In a solid show of commitment to developing public-private partnerships (PPPs) throughout Francophone Africa, 200 leaders from 21 Central and West African countries recently met in Côte d’Ivoire to assess how PPPs can help bridge Africa’s US$34 billion infrastructure financing gap.
The two-day knowledge-sharing forum was organized by the World Bank Institute (WBI) and the Bank’s Africa Region, with support from the African Capacity Building Foundation and the Public-Private Infrastructure Advisory Facility, a multi-donor technical assistance entity created to help governments in developing countries improve the quality of infrastructure through partnerships with the private sector.
Leaders and practitioners present at the Abidjan forum opened up about their experiences and the challenges they face in designing and implementing PPP policies, such as overcoming bureaucratic snags and enhancing performance management. They scrutinized the outcomes of past and current PPPs in Africa, and agreed on a set of essential components that should be included in any strategic PPP framework. They also confirmed the need to raise awareness and mobilize national PPP partners in order to promote PPPs in the region. The forum set up a practitioner community to continue sharing experiences, tools, and knowledge beyond the roundtable.
“Our main question here is how to effectively utilize and promote PPP models in Africa while improving the legal and institutional frameworks so they really work,” said Koffi Ahoutou, Chief of Staff at the ministry of finance of Cote d’Ivoire, the host country.
He noted that countries that lack effective economic policies as well as legal and regulatory frameworks often cannot attract good, sustained investment. This threatens the legitimacy of PPPs and undermines efforts to develop the kinds of policy and legislative strategies that promote private sector development, better service delivery, and overall economic growth.
For Madani Tall, Country Director for Côte d’Ivoire, emphasis needs to be placed on the role that infrastructure plays as a unifying factor, especially in fragile settings. “Infrastructure primarily tends to address a population’s basic social needs, but it also definitely cements social harmony, fosters competition and boosts economic growth and development," Tall said.
In Pursuit of an Enabling Environment
During discussions, public sector officials from PPP units, line ministries, local governments, and service providers wanted to explore new ways to create an environment conducive to attracting private investment and to promoting delivery of services through PPPs. The private sector―well represented by lawyers, corporate bankers, and engineers―sought opportunities for future investment in the region. They voiced concerns about risk management in PPP projects global financing and fundraising issues, the possible role of, and support provided by, governments, and also about the way PPPs get fast and efficient promotion toward prospective investors and partners. With the full range of PPP stakeholders present to enrich the debate, a close look at all angles of PPP project development exposed both the challenges and opportunities linked to such projects.
As the capacity development branch of the World Bank, WBI has been facilitating these public-private dialogues for the past three years in both Francophone and Anglophone Africa, building up a strong regional network of African practitioners. The forums provide a space for stakeholders to share their expertise, exchange ideas, and explore investment opportunities for PPPs in the African market. WBI’s approach combines presentations by international experts, case studies from Sub-Saharan Africa and from international experience, as well as group discussions to foster knowledge exchange and collaboration. Public officials come away equipped with tools for managing the institutional, financial, and legal and policy requirements of PPPs.
The issues raised and lessons learned at this regional forum will be reflected in the design of PPP Days, a global event to be held March 22-24 in Manila, Philippines, where practitioners from PPP units worldwide will analyze and explore innovative PPP models and key policy issues.
Although the interest in PPPs in Africa has grown along with the commitment of policymakers to create better conditions for successful implementation, the benefits that PPPs hold for the continent’s development are yet to be fully achieved.
Toward Community Standards Based on Best Practices
Cote d'Ivoire’s planned PPP program was examined in depth at the recent forum. The country has been one of the PPP pioneers in West Africa, with the launch of its first PPP Project in water supply in the early 1960s. At the government’s request, the forum examined development plans for a national PPP program, highlighting the options and mechanisms available for securing PPPs in the provision of infrastructure services in the country.
Among others, questions on project finance structuring techniques were raised (risk mitigation, consortium building and security package), as well as issues related to international co-financing mechanisms and securitization techniques in project financing. Participants called for a more integrated approach in policies and guidelines on PPPs through regional economic communities. The European Union’s PPP Green Paper is a good example of this.
To help Sub-Saharan Africa create a better environment for investors and achieve results, participants sketched out recommendations on political and economic stability, strong government commitment, shape in the legal, institutional and regulatory framework allowing financial and economic security, building a network as well as a center for excellence to help disseminate best practices and knowledge sharing.