Syndicate content

infrastructure

Forging a partnership with the Global Infrastructure Hub

Mark Moseley's picture
During the Spring Meetings in mid-April, the World Bank Group committed to addressing the world’s data gaps for infrastructure investments, which will help lower barriers to those investments and help provide services to more people across the globe.

Our team signed an agreement with the recently established Global Infrastructure Hub (GIH) – an initiative of the world’s G20 leading economies – that paves the way for future cooperation.

The GIH came into existence last December, as a result of decisions taken at the November 2014 G20 Leaders’ Summit in Brisbane, Australia. Based in Sydney, the GIH is designed to drive progress on the infrastructure agenda of the G20 and, in particular, to encourage additional private sector involvement with infrastructure development.

It will be a knowledge-sharing network, which will aggregate and disseminate information on infrastructure projects and financing opportunities. The GIH is also designed to assist governments with capacity-building in regard to infrastructure development, by sharing best practice approaches.

Establish a national PPP Unit to support bottom-up infrastructure investment

Robert Puentes's picture
Photo: flickr/cmh2315fl
By any measure, the United States is a laggard in terms of public-private partnership (PPP) projects. Between 1985 and 2011, there were 377 transportation PPP infrastructure projects funded in the U.S. Those projects comprised just nine percent of the total nominal costs of infrastructure PPPs around the world. Europe leads the infrastructure PPP market, concentrating more than 45 percent of the nominal value of all PPPs.

There appear to be several discrete, but related, reasons why the U.S. has been slow to pursue PPPs in comparison with European and Asian countries:
  • In some cases, there is a lack of consensus, institutional capacity, and expertise to properly promote the benefits and costs of PPP deals. In Pittsburgh, for example, an arrangement to lease the city’s parking operations to a private entity collapsed when the city council voted against the transaction.
  • Deals are getting more complex, politically heated, and cumbersome as some stretch across jurisdictions and even international borders, as is the case with the New International Trade Crossing intended to connect Detroit to Windsor, Ontario.
  • With state and municipal finances under strain, the public sector is trying to transfer greater responsibility to the private sector, including in the arena of project financing.
In this regard, the U.S. Government Accountability Office recently noted that while the U.S. has done much to promote the benefits of PPPs, it needs to do more to assist states and metro areas in thinking through potential costs and trade-offs, as well as assessing national interests.

Learning Public-Private Partnerships

David Lawrence's picture

 
Long ago, when I was stationed abroad with IFC, I joined a visiting colleague in a meeting with a senior government official to talk about public-private partnerships (PPPs). A few junior officials were also there, busy scribbling down everything my colleague said. He talked about the benefits of private sector participation in infrastructure, health and education; he described the various forms PPPs could take; he explained how IFC could provide transaction advice. The official, a man nearing retirement with grey hair and professorial glasses, nodded silently as he listened.
 
“Are you following everything?” asked my colleague. “If not I’ll be glad to explain anything that isn’t clear.”
 
“I understand,” he said. “Please continue.”
 
But I could tell from his body language that he didn’t understand anything at all. And I knew he would never admit a lack of knowledge in front of his subordinates. But there was another reason I suspected the official wasn’t being entirely forthright: I could barely follow the discussion myself.
 
After the meeting I googled “public-private partnerships” to give myself a crash course. There were literally millions of information sources, but most were difficult to follow. I ground through a few articles and slowly began to understand. But what of the official? At his level of English, it would be nearly impossible for him to educate himself about PPPs.
 
Why was this a problem? Because the country in question very desperately needed to rebuild its crumbling infrastructure, inject new life into its healthcare system, and bring educational institutions to a higher level. Through PPPs, private sector could potentially contribute financing, managerial expertise and technical know-how to help government address these challenges. But since so few policymakers understood how PPPs worked, it would be hard to tap into these resources.

Look who's talking about PPPs

Alison Buckholtz's picture
Long-term infrastructure planning. Service delivery even beyond the “end of the line.” E-government outreach that includes everyone. As these and other benefits of public-private partnerships (PPPs) reach more people, a deeper understanding of PPP strategies is entering the mainstream. 

Examples of this organic knowledge-sharing, born of individuals’ first-hand positive experiences with PPPs, can be found among thought leaders across a range of fields. Editors of Handshake, the World Bank Group’s PPP journal, have interviewed many of these experts about their experience with PPPs and have compiled some of their perspectives here.
 
Edward Glaeser, urban economist and Professor of Economics, Harvard University (Cities issue, p. 30, “Triumph of the PPP”), on the need for oversight of PPPs: “There is a lot to be gained in the marriage of public and private, but there are also enormous risks. There are cases where either the government has mistreated the private partner, or companies have figured out a way to mistreat the government. PPPs always require firm oversight. They are enormously valuable as a way to solve a financing problem, and the people who are fighting to solve this problem are doing one of the most important jobs in the world.”

Francesco Bandarin, UNESCO’s Assistant Director-General for Culture (Tourism issue, p. 26), on PPPs as a solution for World Heritage Sites: “Over the past 10 years we’ve had an increased level of attention to World Heritage Sites, and there’s been a subsequent expansion in the number of sites as a result. When you have an expansion of your core business the first question you ask yourself is 'How do I keep delivering the same quality of services?' For us, this includes monitoring services, support to member states, tracking and responding to trends, and trying to use tourism as a resources instead of just a force of destruction. We want to deal with tourism in a way that’s constructive. PPPs can help us do that.”

Making PPPs work in fragile situations

Andrew Jones's picture
I have been working in both Afghanistan and the Palestinian Territories for several years now, supporting both upstream enabling activities and working on specific public-private partnership (PPP) transactions. I recently traveled back to both places for our Public-Private Infrastructure Advisory Facility (PPIAF) to help design new interventions that will help develop private sector participation in infrastructure.
 
 
Kabul, Afghanistan
Supporting the development of private sector participation in infrastructure in fragile and conflict affected states is a strategic priority for PPIAF, where immediate and overwhelming infrastructure needs are apparent.
 
In that realm, PPIAF has long been supporting Afghanistan and the Palestinian Territories, among many other conflict impacted economies, and has achieved significant impact, particularly in the telecommunications sector in Afghanistan, and the solid waste sector in the West Bank. Increased access to infrastructure is crucial in fragile and conflict-affected states, and resulting services create opportunity and drive economic growth, thereby reducing the risk of resurgent conflict.
 
While both places face unique challenges, my experiences demonstrate some commonalities that could be applied to other economies with similar situations. Both Afghanistan and the Palestinian Territories have recently undergone political transition, and both have outlined plans to pursue private sector participation to accelerate access to infrastructure and drive economic growth. This comes in the context of growing fiscal constraints and reduced future donor budgetary support.  
 
Let’s look at the specific economic and political context of both Afghanistan and the Palestinian Territories to put things in perspective:

PPPs: Making a real difference in delivering public services in Bangladesh

Syed Afsor H Uddin's picture
Who first introduced Public-Private Partnerships (PPPs)? This is a question that often leads to endless discussions, provides an opportunity for one-upmanship and is an entertaining diversion for practitioners on the margins of international PPP conferences.

During these debates many examples are quoted – the early 20th century oil concessions in the Persian Gulf, the late 19th century cross continental railway in the USA and the İzmir-Aydın railway concession in present-day Turkey, the Rhine river concession granted in 1438[1] and so on.
 
Photo: Rezwan/flickr

As debate on the origin of PPP continues, the modern-day popularity of PPPs is more commonly acknowledged to have emerged from the United Kingdom, following the introduction of Private Finance Initiatives in 1992’s autumn budget statement by RH Norman Lamont, then Chancellor under John Major’s Conservative government.[2]

In the intervening years, many developed and developing nations have started PPP programs of their own. Indeed, the growth of PPPs in developing countries is nothing short of phenomenal, with the mechanism being used in more than 134 developing countries and contributing to 15–20 percent of total infrastructure investment[3].

This is also true of Bangladesh. In 2009, the Government of Bangladesh announced the introduction of a revised PPP program[4] in the 2009/10 Budget Session, and then introduced a new PPP policy in August 2010 (PPP Policy 2010[5]).

A Food System that can feed everyone, everyday, everywhere

Juergen Voegele's picture



Whether you’re a food producer or consumer, and no matter what part of the world you live in, I’m sure we can agree: The world needs a food system that can feed everyone, everyday, everywhere.

A food system that works for everyone can also create jobs and raise the incomes of smallholder farmers and rural residents who are 78 percent of the world’s poor people. After all, growth originating in agriculture is proven to be 2 to 4 times more effective at reducing poverty than growth originating in other sectors. An effective food system can also provide better nutrition, steward the world’s natural resources, and even be a part of the solution to climate change.
 

Public spaces - not a “nice to have” but a basic need for cities

Sangmoo Kim's picture
The benefits of public spaces in the poorest parts of the world
Source: World Bank Staff

We often think of amenities such as quality streets, squares, waterfronts, public buildings, and other well-designed public spaces as luxury amenities for affluent communities. However, research increasingly suggests that they are even more critical to well-being of the poor and the development of their communities, who often do not have spacious homes and gardens to retreat to.

Living in a confined room without adequate space and sunlight increases the likelihood of health problems, restricts interaction and other productive activities. Public spaces are the living rooms, gardens and corridors of urban areas. They serve to extend small living spaces and providing areas for social interaction and economic activities, which improves the development and desirability of a community. This increases productivity and attracts human capital while providing an improved quality of life as highlighted in the upcoming Urbanization in South Asia report.

Despite their importance, public spaces are often poorly integrated or neglected in planning and urban development. However, more and more research suggests that investing in them can create prosperous, livable, and equitable cities in developing countries. UN-Habitat has studied the contribution of streets as public spaces on the prosperity of cities, which finds a correlation between expansive street grids and prosperity as well as developing a public space toolkit.

Tackling climate change – for our kids

Jim Yong Kim's picture
If you have children or grandchildren, you probably have wondered what the world will be like for them in 20 or 30 years. Will it be a better place? Will climate change upend their lives? It's something I have thought about a lot since I became president of the World Bank Group in July 2012. Within the first few months in the job, I was briefed on an upcoming climate change report, and the findings shocked me. I knew then that tackling climate change would be one of my top priorities as leader of a development institution whose mission is ending extreme poverty by 2030 and boosting shared prosperity. If we don't start controlling climate change, the mission to end poverty will fail. Last week I delivered a lecture on climate change at Georgetown University in Washington, D.C., to a roomful of young people who are surely thinking of climate change's impact on their lives. Climate scientists project that if we do nothing to control carbon emissions, temperatures could rise as much as 4 degrees Celsius by the 2080s. Mean temperatures during the last ice age were 4.5 degrees to 7 degrees Celsius lower than today, and the temperature had changed gradually over millennia. We're talking about that kind of temperature shift occurring in the future over a very short period of time. Life on Earth would be fundamentally different.
 

Philippines: Traffic woes and the road ahead

louielimkin's picture
Traffic congestion results in an estimated productivity loss of around PHP2.4 billion ($54 million) a day or more than PHP800 billion ($18 billion) a year.



From my house in northern Quezon City, I drive more than two hours every day to get to the office in Bonifacio Global City, which is about three cities away where I come from, and two cities away from the capital Manila. It’s a journey that should only take around half an hour under light traffic. That is a total of four hours on the road a day, if there is no road accident or bad weather. It takes me an hour longer whenever I use the public transport system. Along with hundreds of thousands of Metro Rail Transit (MRT) commuters, I have to contend with extremely long lines, slow trains, and frequent delays due to malfunctions. This has been my experience for several years. Many of us might be wondering: why have these problems persisted?


Pages