Episodes
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Two critical challenges for countries affected by fragility, conflict and violence (FCV) are creating sustainable peace and constructing a path for growth. Often functioning with limited capacity, these countries possess unique characteristics to produce and enforce infrastructure regulation. In order to develop effective governance and regulatory systems in countries affected by FCV it is important to consider how their specific goals, instruments, and institutional arrangements differ from those of more developed countries.
To assist practitioners to be able to both develop much needed infrastructure and develop a viable regulatory system, the Public Private Infrastructure Advisory Facility (PPIAF) partnered with the University of Florida’s Public Utility Research Center to develop an updated Body of Knowledge on Infrastructure Regulation (BoKIR) that provides updated FAQs, a self-assessment tool, and a maturity taxonomy for practitioners who are developing and implementing infrastructure solutions. This webinar will introduce the portal, summarize its key content, and demonstrate its tools, including showing results from countries that have engaged with the self-assessment. This webinar will also feature an interview with experienced practitioners in the field of infrastructure service delivery -
Virginia began its experience with Public-Private Partnerships by passing the Virginia Public-Private Transportation Act (PPTA) of 1995, which provided the legal framework for PPPs in the transportation sector. In 2002, the Virginia legislature passed the Public-Private Educational Facilities & Infrastructure Act (PPEA) to expand the possibility of PPP procurement outside the transportation sector. The Commonwealth has had a dedicated PPP organization within the state government since 2005, the current form of which is the Virginia Office of Public-Private Partnerships (VAP3). Virginia’s approach to PPP was codified in the publication of its PPTA Implementation Manuel and Guidelines in 2005. Updates, tools, and supplemental material have been developed since then, and the PPEA Implementation Manual and Guidelines was released in 2015.
Virginia has successfully implemented major PPP projects over the past decade, including a Design-Build-Operate-Maintain contract for the Capital Beltway Express Lanes, the Downtown/Midtown Tunnel/Martin Luther King Boulevard Extension in Hampton Roads, and the Interstate 95 express lanes in 2012. Currently, VAP3 is finalizing a contract for the Interstate 66 Outside the Beltway project.
Virginia’s PPP selection process occurs in three phases: Project Identification, Project Screening, and Project Development. Solicited projects and unsolicited proposals are entertained during Project Identification. Project Screening is a two-part, high-level analysis: High-Level Screening/Policy Review and Detail-Level Screening. If proposals continue to Project Development, they will be subjected to value-for-money and risk analysis.
This webinar will seek to expand upon Virginia’s PPP selection process, especially in identification and screening. The webinar will also discuss how Virginia’s experience works within the U.S. federal, state, and local infrastructure, and how applicable this experience can be for developing economies. -
Missing episodes?
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Some countries and regions were successful in reviving their infrastructure project finance markets in 2015 compared with the previous year, others less so. Overall, there was a slight rise in volumes, with the transport and renewables sectors leading. In 2016, the trend so far has been toward lower volumes and fewer closed deals. This webinar will look at the current trends in infrastructure project finance in major regions of the world from the perspective of the lender.
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The Republic of Korea has a long history of PPP. Its early experience consisted of individual legislation for specific projects. In 1994, the government began to formalize its process with the passing of the Act for the Promotion of Private Capital Investment in Social Overhead Capital, which provided the legal framework for the broader use of PPP. The legislation was revised in 1999 to produce the Act for Public-Private Partnerships in Infrastructure, which provided for the establishment of a PPP unit. The Korea Development Institute’s Public and Private Investment Management Center (PIMAC) currently serves as Korea’s PPP unit. From 1994 to 2015, the country implemented 684 PPP projects.
PIMAC is authorized to conduct prefeasibility studies for publicly financed projects with a total project cost of at least W50 billion, where W30 billion or more is subsidized by the State. Under the PPP legal and institutional framework, PIMAC screens and appraises PPP projects during the selection process. Solicited projects costing W200 billion or more for build-transfer-operate projects, or at least W100 billion for build-transfer-lease projects, and all unsolicited proposals are subject to analysis by PIMAC.
In Korea, potential PPP projects are identified by line ministries, or the private sector in the case of unsolicited proposals. As part of the feasibility assessment, projects (publicly financed and PPP) are subject to the Analytic Hierarchy Process, which includes economic, policy, and balanced regional development analyses. Following this process, projects go through project appraisal, where qualitative and quantitative (including value-for-money) analyses occur. If a project successfully completes this process, PIMAC will recommend it for procurement as a PPP. -
The Netherlands has a rich history of private participation in the development of its public infrastructure, dating back to the country’s beginnings in the sixteenth and seventeenth centuries. However, the idea of formalized PPP immigrated to the Dutch political establishment in the 1980s from the United Kingdom’s experimentation with private finance initiatives. As a solution to the country’s budgetary woes, the Dutch government attempted PPP for a couple of tunnel projects at the end of the decade. Unfortunately, these projects experienced cost overruns and unpopularity, and the idea was abandoned for future projects until the late 1990s.
In 1999, the Ministry of Finance established the PPP Knowledge Centre, which drove much of the policy discussion on PPP until 2006. In 2004, the European Commission published a Green Paper on Public-Private Partnerships and Community Law on Public Contracts and Concessions. This paper currently serves as the legal guidance for Dutch PPP, and served as a catalyst for additional PPP development in the Netherlands. In 2006, the Ministry of Transport, Public Works, and Water Management started a PPP unit, beginning a rigorous campaign for PPP development. The success of this unit was followed shortly thereafter by the Ministry of Housing, Spatial Planning, and the Environment developing its own PPP unit, and later by the Ministry of Agriculture, Nature, and Food Quality. Cooperation between these three units led to the fast development of the Netherland PPP market and best practices, including standardized contracts, uniform reporting to Parliament, and standardized risk matrixes. This work precipitated project responsibility to fall to the executing ministry, with essential framework developments from the Ministry of Finance.
The Netherlands has developed its PPP selection process over the past decade, paying special attention to streamlining and publicizing the process to attract potential investors. The idea of creating an efficient and expeditious process was developed from the necessity to attract the private partners drawn to the larger PPP markets in France and the United Kingdom. This is also why the Netherlands only procures Design-Build-Finance-(Operate)-Maintain PPP projects. The Netherlands developed a small but dedicated group of civil servants, fostered by PwC, to create an enabling PPP environment. The Dutch approach to PPP selection is encompassed in three main analyses: Market Scan, Public-Private Comparator, and Public Sector Comparator. -
In 1997, the South African Cabinet approved an inter-departmental task team to create a package of policy, legislative, and institutional reforms to create an enabling environment for PPPs. To facilitate this work, several pioneering PPPs were carried out by the South African Roads Agency, Department of Public Works and Correctional Services, South African National Parks, and two municipalities. The lessons learned from these preliminary projects helped in the development of a strategic framework for PPPs in 1999. The Parliament of South Africa passed the Public Finance Management Act (PFMA) in 1999. In 2000, the National Treasury enacted Treasury Regulation 16 in terms of the PFMA, which outlined the definitions and functions of PPP. This led to the establishment of the PPP Unit within the National Treasury and the publication of the Public Private Partnership Manual in 2004, which has since been updated to reflect changes to law and policy.
The Government Technical Advisory Centre (GTAC) provides specialized analytical support to the National Treasury for the assessment of proposed large infrastructure investments. Project appraisals of megaprojects are undertaken to determine the likely economic and financial viability of the project, particularly where financial support is being requested from the fiscus. GTAC also performs related types of analysis, such as the likely impact of infrastructure investments on the financial sustainability of public utilities, financial cost comparisons of different elements of proposed investment programs, and potential funding mechanisms for infrastructure projects and programs. GTAC’s aim is to ensure that support is provided to the government in identifying public projects that offer the greatest value for money and contribute the most toward promoting economic growth and social welfare. The Capital Projects Unit has developed in-house methodologies for assessing projects and programs.
GTAC seeks to assess proposals based on their value for money. Value is the economic and social activities the infrastructure supports, and money is the cost to put the infrastructure in place. The Capital Projects Unit assesses a proposal’s value for money by examining its social and economic context, demand, viability, financial aspects, and project deliverability. -
Afghanistan, like many developing countries, has been seeking ways to develop and improve infrastructure within the framework of limited fiscal capabilities. In recent years, the World Bank Group has been working with the Government of Afghanistan on increasing private participation in infrastructure. Public-private partnerships are increasingly seen as a means to harness private innovation and finance while the government maintains ultimate ownership and insurance of the public interest. Although procuring infrastructure projects through PPP methods may be more efficient and provide greater value for money, the pre-tender project development costs tend to be higher than those associated with traditional procurement. In an effort to reduce waste in resources, it is important to have an effective methodology and tools to aid in identifying and screening potential PPP projects before resources are utilized in a full feasibility analysis. In 2015, the World Bank Group assisted the Government of Afghanistan in legal and regulatory reform to foster the growth of PPP. One of the products of this effort was the development of the PPP Suitability and Prioritization tool. This tool seeks to streamline the PPP process and ensure that resources are only used for proposals with a greater chance of viability.
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This is a joint initiative of the World Bank Group and the PPP Unit Kenya. PPP projects of all sizes have faced challenges securing commercial financing. Governments have therefore attempted to improve the bankability of projects using key support instruments in the form of equity, debt, grants, guarantees, fiscal incentives, and specific contract clauses based on project needs. Often governments do this on a case-by-case basis through customized solutions, and it can also be done by preparing frameworks and standard operating procedures for the use of these instruments. All of these instruments, particularly grants and guarantees, can be powerful mechanisms of risk sharing provided they are used judiciously. This webinar will look at the role of tolls, viability gap financing, and other forms of funding and financing required to make PPPs in Kenya successful. There will be a focus on issues in financing and funding Kenya’s flagship PPP projects in the transport and social sectors.
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While legal and regulatory frameworks enable the creation and implementation of PPPs, it is important that there is a second tier of institutions and processes to facilitate the implementation of the law, regulations, rules, and policies. In the absence of these institutions, PPPs are less likely to come to fruition, or may develop much more slowly. In addition, the entities entrusted with specific roles and responsibilities under legislation are unable to fulfill their responsibilities appropriately.
This webinar will discuss the quality of PPP institutions, their influence, authority, maturity, and impact on PPP implementation in Kenya. -
Kenya’s PPP Act of 2013 requires every PPP project to be assessed for its impact on the government’s balance sheets. The assessment is mandated to take place at the feasibility stage, following the completion of negotiations with the preferred bidder, and at any point during a project when amendments or modifications to the contract change the government’s fiscal exposure.
Based on the legal mandate, a fiscal commitment and contingent liabilities management framework has been created in Kenya with the Public Debt Management Office (PDMO) as one of the key drivers of the process. Kenya is among the first lower-middle income economies to develop such a framework. This webinar will discuss the framework, its development, and implementation, as well as its implications for Kenya’s PPP program. -
Brazil, Latin America’s largest economy, has had broad experience with PPPs, and since the global economic slowdown in 2009, the Brazilian government has further prioritized infrastructure investment. As host of the World Cup in 2014 and the Olympics in 2016, Brazil is seeking to overcome its infrastructure gaps. Brazil has undertaken PPP projects at the federal and subnational levels. The 2014 Economist Intelligence Unit Latin America & Caribbean Infrascope categorizes Brazil’s PPP readiness as developed, and places it within the top two in the region. The discussion will provide the audience with the latest market trends and state of PPPs in the country. Based on the current political and economic conditions in the country, the speaker will address the importance of the enabling environment for PPP market development.
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Both public support and stakeholder engagement are essential for a PPP program’s success. Interests and preferences of these stakeholders can impact the outcome of PPP programs and project ideas. Some emerging issues surrounding stakeholder engagement in Kenya include the willingness to pay for surveys leading up to transactions; disagreements with project host communities; and reluctance on matters relating to land acquisition. Therefore, a clear dialogue and transparent communication between the government and key stakeholders are imperative for achieving stakeholder support and establishing ownership of PPPs in a country.
This webinar will look at some key issues surrounding communication with key stakeholders in PPPs in Kenya. -
While Kenya is still in the early stages of implementing a structured PPP program, litigation seems to be an emerging reality; this has both positive and negative ramifications.
Section 67 of the PPP Act 2013 provides for a Petition Committee to receive and resolve all complaints relating to the procurement of a PPP project in Kenya. The Petition Committee is in line with Article 50 of the Constitution of Kenya and acts as a tribunal to promote procedural fairness and transparency in the procurement of PPPs.
Specific Petition Committee Guidelines were published in 2014 to support its functioning and to guide petitioners, and the Government of Kenya finalized Petition Committee Regulations recently. Given the frequency of litigation, the Petition Committee has been fully occupied with this work since its establishment. -
In many Organization of Islamic Cooperation (OIC) member countries, an increasing number of PPP infrastructure projects are being jointly financed by conventional and Islamic banks. While these projects bring together conventional and Islamic tranches, one frequently asked question is: how are these two financing classes integrated in a single project?
In this webinar, we will discuss the case of a hospital PPP project where both conventional and Islamic banks are present as lenders. The case will present the transaction structure and the documentation involved in the structure that put together these two types of lenders in one transaction, focusing on the Istisna’a modes of financing.
Istisna’a financing requires the Islamic banks to provide fixed rate of pricing, while the conventional lenders mainly provide long-term variable rate financing. This webinar will discuss the methodology applied to bring in the pricing parity between conventional and Islamic lenders in PPP projects.
While presenting the transaction structure, this webinar will also discuss the case of security sharing, treatment of some conventional fees by the Islamic banks, lenders’ decision-making processes, and specifics of Islamic finance. -
Kenya’s new constitution (passed in 2010), lay the groundwork for devolution. As with any country in transition, there is a lack of clarity between the roles and jurisdiction of the implementing authorities at the national and county levels in several areas. This creates challenges while implementing PPP projects, since the very right of the authority to develop the project or enter into an agreement with the private sector may be questioned.
The Government of Kenya has recently drafted its County PPP Regulations, which aim for greater clarity in the roles and jurisdiction of implementing and contracting authorities at the national and county level. The regulations were developed in the context of the changes brought about by the devolution process. This webinar will discuss the trends, practices, challenges, and implications of the County PPP Regulations with a focus on clarifying roles at the national and subnational levels. -
In many Organization of Islamic Cooperation (OIC) member countries, an increasing number of PPP infrastructure projects are being jointly financed by conventional and Islamic banks. While these projects bring together conventional and Islamic tranches, one frequently asked question is: how are these two financing classes integrated in a single project?
In this webinar, we will discuss the case of a typical IPP project where both conventional and Islamic banks are present as lenders. The case will present the transaction structure and the documentation involved in the structure that put together these two types of lenders in one transaction. While presenting the transaction structure, this webinar will also discuss the case of security sharing, treatment of some conventional fees by the Islamic banks, lenders’ decision-making processes, and the specifics of mobilizing Islamic finance.
The webinar will discuss the Ijara (leasing) mode of financing, as this is the predominant mode of financing used by Islamic banks for funding IPP projects. -
Islamic financing is starting to emerge as a significant source of funding for PPP infrastructure projects, such as airports, toll roads, sea ports, independent power plants, and hospitals. With the increased effort by emerging economies to mobilize private financing for infrastructure through the use of PPPs, and the limited sources of debt and equity financing, global trends show that two predominant Islamic finance modes are being used for financing PPP projects: Ijara (lease purchase finance) and Istisna’a (commissioned manufacture of specified asset). Many governments are now looking to understand the legal and regulatory issues relevant to the flow of Islamic financing, whether in the form of debt-based contracts or equity-based contracts, and what project structures can or cannot work well with these features. This webinar series will focus on increasing knowledge on Islamic financing within countries looking for infrastructure finance, and better facilitation of the use of Sharia-compliant instruments for mobilizing private investment in infrastructure through PPPs.
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In the Southern African Development Community (SADC) member states, PPPs are being increasingly seen as a solution for challenges related to efficiency, capacity and fiscal constraints. This webinar will discuss the main issues and challenges related to the frameworks for PPPs in key SADC countries that are active in the PPP space.
Space is limited, we encourage you to register early and we look forward to your participation.
To learn more about the PPP Webinar Series and other PPP news, follow us on Twitter @WBG_PPP - #PPPs. -
Canada is now considered among the world’s more mature PPP markets. Clarity and predictability built into the PPP process through robust frameworks and guidelines are among the distinguishing features of such markets.
This webinar will discuss Canadian PPP frameworks and guidelines and their key strengths, along with their applicability to other jurisdictions worldwide.
Space is limited, we encourage you to register early and we look forward to your participation.
To learn more about the PPP Webinar Series and other PPP news, follow us on Twitter @WBG_PPP - #PPPs. -
This webinar aims to review Kenya’s infrastructure financing and PPP program from the lenses of its legal and regulatory frameworks.
Kenya issued a National PPP policy in 2012 and adopted a PPP Act in 2013 facilitating the establishment of a PPP Unit in the National Treasury. Efforts are also underway to develop a framework for Government Support Mechanisms and another for managing Fiscal Commitments and Contingent Liabilities (FCCL).
One challenge that Kenya faces with its PPP program is that, although there is strong interest from county governments in implementing PPPs as a means of financing local infrastructure development, there is a dearth of information on the potential pipeline of county PPP projects; the required policy, regulatory and institutional arrangements that need to be put in place to support county PPPs; and clarity on the roles and responsibilities of counties vis-à-vis national Ministries and agencies.
Space is limited, we encourage you to register early and we look forward to your participation.
To learn more about the PPP Webinar Series and other PPP news, follow us on Twitter @WBG_PPP - #PPPs. - Show more
