Ensuring the efficient use of public-private partnerships in MENA countries
Public-private partnerships represent a real opportunity for the countries of the MENA region, which often have high infrastructure requirements but low quality public service performance. Through two case studies, Tunisia and Jordan, Chapter 8 shows how governments in the region are implementing ambitious PPP policies to resolve some of these issues. The case studies focus on public decision-making, adaptation of PPP legal frameworks and strategies to strengthen administrative capacities for PPP contract design, negotiation and implementation. These two cases demonstrate that PPPs can accelerate improvements to public infrastructure, which is fundamental for economic growth and better citizen access, service efficiency and service quality.
Three PPP contracts have already been launched in Jordan. These include the Assamra water treatment plant, the Queen Alia Airport in Amman and a contract for processing medical and industrial waste in the Amman area. The Assamra project is a BOT-type contract (build, operate and transfer) concluded in 2002 with a planned private investment of some USD 169 million and a mandate to provide water treatment services and supply water for irrigation. The logic of forming consortia to bid on PPP projects requires that the group assemble all the competencies necessary to fulfil the contract, which may involve complex partnering arrangements.
The Tunisia case study explores PPP contract examples like the concessions awarded for the airports of Enfidha and Monastir and for water treatment in El Al and El Attar (II). These examples combine the BOT model for new infrastructure with the BROT (build, rehabilitate, operate and transfer) model for existing infrastructure. The latter model permits the operator to repair and make use of existing infrastructure while also expanding the facility, reducing the need for financing, making leverage ratios more attractive to funders, and potentially reducing construction costs. This model may be particularly appropriate during the present financial crisis, which is impeding project financing.