There is a massive gap between the need for infrastructure investment around the world and the ability of governments to pay for those investments. Public-private partnerships, in which the private sector builds, controls, and operates infrastructure projects subject to strict government oversight and regulation, can help bridge that gap. (www.bcgperspectives.com)

2. The Reference Guide (Public-
Private Partnerships;
Reference guide; Version 2.0)
defined PPP, as: ‘’A long-term
contract between a private
party and a government entity,
for providing a public asset or
service, in which the private
party bears significant risk and
management responsibility, and
remuneration is linked to
performance.’’

4. It needs to deeply
understand and
address the three
sphere :
Economics,
Politics, and
Execution
—in an integrated
way.
( Ref : IFC ; WBGroup
; 2013 )
Execution
Politics
Economics

5.  Ensure sound economic fundamentals.
 Structure the partnership to optimize cost, quality,
and investor return—in other words, to achieve
both the public policy and business objectives.

6.  Secure political champions.
 Build stakeholder support.
 Assess and manage the key social and
environmental impacts.
 Foster a stable and supportive regulatory
environment.

7.  Use a disciplined approach—time and complexity
are your enemies.
 Secure a mix of global and local expertise.
 Support a transparent, competitive bid process.
 Plan for ongoing contract monitoring and review.

10. To manage the Projects over their life cycles the
Government needs :
 To Create a Comprehensive and Prioritized
Infrastructure-Investment Plan
 To Identify Projects That Are Well-suited for a
PPP by:
 Training the right people
 Developing benchmark databases
 Developing standardized methodologies

11. Three crucial steps that governments must take to
create the right environment for supporting and
driving PPPs :
Establish
Rigorous
Program
Management
Communicate
with the
Public Early
and Often
Ensure the
Necessary
Public- and
Private-
Sector Skills

12. Infrastructure Procurement Routemap Process (Source :
Infrastructure procurement routemap: technical note on application ;
Infrastructure UK ; January 2013 ) (http://www.hm-
treasury.gov.uk/iuk_cost_review_index.htm)
Complexity
Assessment of
the Delivery
Environment
Capability
Assessment
(Investment and
Delivery
Planning )
Capability
Assessment
(Client and
Supply Chain
Appraisal)
Delivery Route
Selection and
Implementation

13. Level 1
(vulnerable)
Level 2
(governed)
Level 3
(assured)

14. the sponsor should:
• Screen and review categories of delivery routes to
check for alignment with requirements for a successful
outcome and sponsor / asset management capability;
• Verify whether any of the delivery routes have to
be ruled out or would require significant organisational
change;
• Select a range of preferred delivery routes and
consider what this requires of the delivery organisation;
and
• Capture critical issues and capability gaps. Initiate
the sponsor enhancement programme.

17. The key risks :
(a)Construction and Completion Risk
(b)Operating Risks
(c)Demand Risk
(d)Political and Regulatory Risk and Expropriation or
Nationalization Risk
(e)Environmental Risk
(f)Social Risk
(g)Currency Exchange Risk
(h)Interest Rate Risk
(Sources : http://ppp.worldbank.org/public-private-
partnership/financing/risk-allocation-mitigation)

18. It requires :
•Project feasibility
- Technical feasibility
- Legal feasibility
- Environmental and social sustainability
•economic viability of the project
•Value for money of the PPP
•Fiscal responsibility
•Scale of the project
•Opportunities for risk transfer
•Market capability and appetite

20. INCREASING FISCAL
RESOURCES
IMPROVING PUBLIC SECTOR
CAPACITY AND
GOVERNANCE
•Additional sources of funding
and financing by increasing the
funding available for
infrastructure :
- Increased revenue from
user fees
- New revenue streams from
greater asset utilization.
- overcome short-term cash
budget constraints
- overcome public sector
borrowing constraints.
•Private sector analysis and
innovation
•Private sector experience
and incentives
•Long-term investment
perspective

22. Balancing private and public sector interest.
Transparency and Investor confidence.
Multi-skilled and experience team.
Direct experience in the relevant sector and market.
Ties with the Global Investment community.