Robert Allen’s recent AER paper on “Absolute Poverty: When Necessity Displaces Desire” is a fascinating read, on many levels. The paper uses linear programming (LP) to compute (four variants of) least-cost diets for twenty countries, using prices from the International Comparisons Project (ICP) microdata. To the resulting least-cost food budgets, estimates of non-food costs covering housing, fuel, lighting, clothing and soap are added, generating “basic need poverty lines” (BNPL) for each country.
The data revolution is upon us and the benefits, including improving the efficiency of corporations, spurring entrepreneurship, improving public services, improving coordination, and building profitable partnerships, are becoming more evident.
For public services, the potential gains are impressive. Globally in the electricity sector, an estimated $340 – 580 billion of economic value can be captured by providing more and better data to consumers to improve energy efficiency, and to operators for streamlining project management and the operation of their facilities. Even larger gains ($720 – 920 billion) could be captured in the transport sector.
Exploring the benefits of open data in the solid waste sector has been slower than for other services, however, if you take a closer look, the benefits may be substantial. Solid waste services have a lot to gain – with low service coverage and a lack of modernization in most parts of the world; solid waste services can be costly, representing 10 – 50% of municipal budgets in many developing countries; and it is directly dependent on many actors. To be effective, citizens, institutions, and private companies need to be informed and involved.[Download: What a Waste: A Global Review of Solid Waste Management]
Some examples of what making better quality data available on solid waste services could do include:
The best laid plans… have data. With average waste collection rates of 41% and 68% for low- and lower middle-income countries, respectively, and less than 10% of the corresponding waste disposed in a sanitary manner, many municipalities in the world lack solid waste services. The introduction of modern solid waste systems in these areas represents a monumental organizational change and logistical challenge. It necessitates the introduction of collection services for, among others, each household, and every commercial building and supermarket; the coordination with, informing, and incentivizing all the actors in recycling; the operation of transport services; and the operation of effective disposal or treatment options for the daily, relentless influx of waste. Systematically collecting quality data will help municipalities to undertake strategic planning, integrate service planning into urban planning, and make the necessary decisions that allow them to establish a solid waste system that is properly dimensioned and cost-effective.
The post-2015 Sustainable Development Goals (SDGs) are an ambitious set of targets that aim to support a comprehensive vision of sustainable development that embraces economic, social, and environmental dimensions. Solid waste plays an important role in several of these goals, including providing sanitation for all, making cities and human settlements sustainable, encouraging sustainable consumption, and reducing climate change.
In the planning undertaken by Multilateral Development Banks (MDBs) to help achieve these goals, one glaring fact stood out: the financial resources needed are not only expected to be substantial, in the “trillions” of dollars annually, but they far outweigh the current “billions” of dollars annually in financial flows from development institutions. Considering this information, it was agreed at the Hamburg G20 Summit that a new approach would be needed to unlock, leverage, and catalyze other sources of financing, including private sector resources.
The approach would more systematically prioritize private financing solutions when they are feasible. That is, private solutions that are already working would be considered as a first option; followed by encouraging private investment by reducing policy and regulatory gaps and risks that currently discourage participation; and, finally, as a last option, when private solutions cannot fulfill all the demands of the sector, public resources could be strategically used.
Considering the successes and challenges of private sector involvement in solid waste, it is an opportune moment to begin to ask: what are the key issues that need to be addressed to better leverage the private sector to provide sustainable solid waste management solutions?
[Read: World Bank Brief on Solid Waste Management]
Have solid waste laws done enough? Regulations and policies have progressed significantly, with many countries establishing new solid waste laws that replace decades-old sanitation or public nuisance legislation. Have these reforms gone far enough to specifically encourage the private sector? Are there functional mechanisms for cost recovery, and is there sufficient flexibility for the private sector to pursue a variety of contractual and financing arrangements? Are the laws truly motivating investment into modern facilities by providing enforceable requirements and standards for the establishment of landfills, closing dumpsites, and establishing recycling facilities? Are the financing schemes predominantly focused on public financing, or do they cater to what the private sector financing needs? It is worth a second look at how these laws respond to these and other issues, and learning from those countries that have taken them on.
Welcome to the “10 Candid Career Questions” series, introducing you to the infrastructure and PPP professionals who do the deals, analyze the data, and strategize on the next big thing. Each of them followed a different path into infra and/or PPP practice, and this series offers an inside look at their backgrounds, motivations, and choices. Each blogger receives the same 10 questions that tell their career story candidly and without jargon. We hope you will be surprised and inspired.
Many countries are experiencing urbanization within the context of increased decentralization and fiscal adjustment. This puts sub-national entities (local governments, utilities and state-owned enterprises) in the position of being increasingly responsible for developing and financing infrastructure and providing services to meet the needs of growing populations.
However, decentralization in many situations is still a work in progress. And often there is a mismatch between the ability of sub-nationals to provide services, and the autonomy or authority necessary to make decisions and access financing—often leaving them dependent on national governments. Additionally, they may also contend with inadequate regulatory and policy frameworks and weak domestic financial and capital markets.
- sustainable cities
- municipal governance
- infrastructure financing
- Public private partnership
- Public Private Partnerships
- Urban Development
- Public Sector and Governance
- Private Sector Development
- Europe and Central Asia
- Latin America & Caribbean
Photo: Passarinho/Pref.Olinda | Flickr Creative Commons
A few weeks ago, I delivered the training for the Certified Public-Private Partnership Professional (CP3P) Preparation exam to a group in São Paulo. I was about to commence my closing remarks at the end of the three-day very intensive journey, when a particularly dedicated participant asked: “Why is it that we have never heard of so many of these concepts before?”
It was indeed a very good question.
What are the key considerations for a public authority when drafting a Force Majeure provision in a Public-Private Partnership (PPP) contract? What are the differences between emerging and developed PPP markets in treating Change in Law clauses? And are there particular legal matters that need to be contemplated in a civil law jurisdiction rather than in a common law country when dealing with termination payments under a PPP agreement?
These are only some of the questions the World Bank Group’s recently-published Guidance on PPP Contractual Provisions, 2017 edition aims to address for the benefit of public authorities (contracting authorities) involved in PPPs. This blog is the first in a series of posts that will discuss and explore the issues covered in the 2017 Guidance.
“I walk through three farm plots of my fellow farmers every day to examine the crop growth and occurrences of pest attacks or crop failure. I send photo alerts via my smart phone to Cropin, which sends an advisory within a few minutes to remedy the problem, said Pratima Devi, a climate smart village resource professional in Manichak village in the Barachatti block of Gaya district in Bihar, India.
Cropin Technology Solutions Pvt. Ltd, a private software and mobile apps company, has developed digital applications to advise farmers on ways to achieve optimal harvests, depending on weather conditions, soil and other indicators. In less than a month, Pratima Devi completes a visit to all the farm plots in her village that are registered to get agro-advisories. “Women farmers appreciate my efforts and have started trusting my advice because they see a positive difference on their farms,” she adds.
Ramchandra Prasad Verma has the status of a master trainer of climate-smart village resource professionals in the same Barachatti block. He succinctly explains how data on weather parameters, such as rainfall, temperature and humidity, provided by the Automatic Weather Station (AWS), which was installed by another private Indian company, Skymet, helps farmers make smarter decisions in the village. “When the AWS shows temperatures of 35-40 degree Centigrade, farmers will wait for cooler temperatures before transplanting paddy mat nurseries into the field. Otherwise, there is a fear of losing crops in high temperatures”, said Verma. Earlier farmers relied on traditional wisdom alone, but now digital information can help them make faster and better decisions on the times of sowing and harvesting.
When Verma was a village resource professional, he had raised the maximum number of alerts in Bihar and received many advisories from Cropin on sowing, soil health, seed treatment, and weather forecasts that benefitted farmers. Over time, he developed skills to interpret technical advisories, train farmers to apply information on their fields, and interact with Cropin and Skymet professionals, which earned him the status of a master trainer.
Developing resilience in agriculture to regular weather shocks in the short-term and to climate change in the medium- to long-term is one of the biggest challenges facing Indian farmers today. Large-scale pilots are being implemented in four districts of Bihar and Madhya Pradesh to test the effectiveness of digital apps to generate climate resilient solutions for farming needs. This was made possible through a public-private partnership between the State Rural Livelihood Missions in Bihar and Madhya Pradesh with Cropin Technology and Skymet. These pioneering digital tools are being developed and utilized as part of the Sustainable Livelihoods and Adaptation to Climate Change (SLACC) Project associated with the Government of India’s National Rural Livelihoods Project (NRLP).
Photo: Lufa Farms | Flickr Creative Commons
Have you ever walked around a megastore, lost in the aisles of choices, only to go home without the one item you set out for? Conversely, have you ever wandered into a much smaller “mom and pop” shop and found everything you need?
Many reasons compel us to support small and medium businesses: tailored knowledge, personalized service, and the satisfaction of contributing directly to the local economy.
The benefits of supporting such small and medium-sized enterprises, or SMEs, carry over into Public-Private Partnerships (PPPs). But often, these enterprises find themselves “crowded out” by the bigger players in infrastructure. SMEs in developing countries may find it particularly costly and time consuming to comply with complex pre-qualification criteria or bidding documents, leaving them unable to compete with market leaders. This is unfortunate, because , decrease costs, facilitate logistics, encourage increased competition, and create broader opportunities for economic development.
These vital and homegrown engines of growth are the focus of a new section on the PPP in Infrastructure Resource Center (PPPIRC) that links the policies, laws, and contractual clauses that can foster a more inclusive approach to SMEs in PPPs.