I have seen several trends emerge from discussions I have had over the past year with PPP public sector practitioners about the ability of their government institutions to promote PPP best practices and enhance enabling environments:
The World Region
PPPs are designed to achieve improved access to assets, infrastructure and services over a significant number of years. They should have clearly identified objectives, specified outcomes, clear programs of investment over time, and relationships and performance targets to bring to life the Social and Economic Value Equations that underpin them.
As stated in my previous blogs, the Social and Economic Value Equation is:
One of my favorite songs when I was growing up was John Lennon’s “Imagine.” A few months ago, UNICEF created a project around it to highlight the plight of millions of refugee children. As 2016 drew to a close, I couldn’t help but imagine a world with high-quality, affordable, sustainable, well-maintained infrastructure services for everyone.
I’m not sure a video of infrastructure projects set to “Imagine” would fire people up as much as the UNICEF video does. But there is value in reflecting on what we have accomplished in 2016, and what we might hope for and imagine in 2017, to bring this vision closer to reality for millions of people.
- Public Private Partnerships
- Public private partnership
- Labor and Social Protection
- Agriculture and Rural Development
- Climate Change
- Financial Sector
- Global Economy
- Information and Communication Technologies
- Law and Regulation
- Private Sector Development
- Public Sector and Governance
- Urban Development
- The World Region
Photo Credit: United Nations
Development of infrastructure services is often a central feature for rebuilding fragile and conflict affected states (FCSs). One of the reasons is that infrastructure is often devastated by conflict, making provision of water, power, communications and transportation priorities for recovery efforts. Another reason is that equitable distribution of services may be an important feature of a peace agreement and any appearance of unfairness could spark renewed unrest. Whatever the motivation, without proper planning for governance, the development can falter.
There are two governance challenges with infrastructure in FCSs. One is that the urgency to provide service sometimes overshadows developing systems that can easily transition from something quickly built to infrastructure with sound governance that grows and matures as the country progresses. Another challenge is establishing regulations that encourage investment by protecting property rights. And given the diversity of FCSs situations, there is no one-size-fits-all answer.
How can development professionals advance good infrastructure governance amongst the turbulence and urgency of infrastructure recovery in FCSs? PPIAF and the Public Utility Research Center (PURC) at the University of Florida recently launched a web portal to assist in this work.
One of the prevailing notions about PPPs is that upfront costs are wholly paid for by the private sector, allowing the public to spread their costs (whether as users or through taxes) throughout the life of the project. However, this is a myth – governments, multilateral development banks (MDBs), and bilateral financing institutions all play strong roles in the various stages of financing PPPs. Just what kind of role, and how big, requires looking at the data.
Fortunately, now for the first time, it is possible to view the breakdown of financing sources for PPPs in low- and middle-income countries on the PPI Database. Accompanying the data is a recently released note that analyzes the sources of financing for 2015 PPP projects in these countries. The findings indicate that, in fact, financing for PPPs comes from a diverse mix of sources.
The Sources of Financing Note, available on the PPI Database website, breaks down the data on how upfront capital costs in PPPs in the dataset are financed globally, and by region and sector.
“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us— in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.”
- Charles Dickens, A Tale of Two Cities
Photo Credit: Thomas Hawk via Flickr Creative Commons
I love the TV show “The Big Bang Theory.” It gives a sympathetic view of geeks, where the nerdy guy gets the beautiful girl—I just wish it had been made when I was in high school. I was the geek, without the chic. At the mercy of the big, macho kids, who seemed to have gone through puberty years before I even knew what the word meant.
I thought I had left all of that in high school, but there is a tendency in PPP to perpetuate the macho stuff. Let’s take toll roads as an example. A few frustratingly macho myths about toll roads that only a geek can bust:
I recently took part in #skipthegrid, a social media forum about renewables, which has led me to ask: “Is off-grid the way of the future for energy Public-Private Partnerships (PPPs) in lower-income countries?”
At the Private Infrastructure Development Group (PIDG) we are supporting smaller, off-grid projects in the lowest income countries in Sub-Saharan Africa and South and Southeast Asia by mobilizing private investment for the provision of power to commercial off-grid properties and the construction of mini-grids.
Photo Credit: Myxi via Flickr Creative Commons License
In our last post, we highlighted a few examples of the innovative organizational structures that institutional investors have created to more efficiently invest in public infrastructure assets, but that is just one side of the equation. We also study programs and policies put in place by governments to more efficiently facilitate investment in the right projects and on the right terms for their constituents. That research encompasses several different topics, including enabling legislation, project risk allocation, stakeholder engagement and management, assessment frameworks for determining whether a Public-Private Partnership (P3) makes sense for a given project and others.
Photo Credit: Kathleen Bence via Flickr Creative Commons
I’ve been looking for a good definition of social enterprise. The information overlords at Google and Wikipedia suggested this:
“A social enterprise is an organization that applies commercial strategies to maximize improvements in human and environmental well-being—this may include maximizing social impact alongside profits for external shareholders.”
That’s a pretty broad and somewhat unsatisfying definition. I mean: “What organization in the 21st century wouldn’t put human and environmental development, social impact and profit high on their agenda?” – (He asks naïvely.)
Infrastructure professionals think a lot about social enterprise, but in a slightly different way. There is of course the unrelated term “social infrastructure,” which broadly covers public services such as healthcare, education, leisure and other government services. But really what we think about when it comes to social enterprise is “infrastructure morality.”