accountability

Sometimes overlooked, but essential - like good plumbing: Why accounting matters for development

A few weeks ago, The Economist published an article on economic governance that discussed the importance of public sector accounting. It recognized the importance of maintaining existing public-sector assets and investment in new ones. These assets, according to an IMF study, account for a significant portion of GDP. But, the article asserts, filling potholes and repairing bridges are not as politically appealing as flashy new infrastructure, and few economies engage in robust public-sector accounting that demonstrates the net worth of these assets.

Maybe if governments and citizens understood the value of their public assets, they’d be inclined to invest in their maintenance – avoiding waste and even catastrophic accidents when poor infrastructure fails?

Keeping the public and private in PPPs

Tomas Castelazo | Wikimedia Commons

The Colombian magazine Dinero, one of the most respected economic publications in Latin America, recently published a story about a World Bank study that placed Colombia as the second most competitive country in the world—behind a tie between Great Britain and Australia—to finance infrastructure projects under the public-private partnership model (known as PPPs). This score (83 points out of 100) was also shared by Paraguay and the Philippines.

At first glance, this is a virtuous recognition—at least on paper. However, in daily practice in the Latin American region, like most emerging economies, the administrative complexity of government bodies still presents enormous challenges that demand immediate attention if PPPs are to reach their full potential. Getting this right would truly integrate the PPP model into the economic and social development engine required to compete in a globalized economy.

Suggestions from a pragmatist to boost the impact of PPPs

Recently, I published a book about infrastructure public-private partnerships (PPPs) in the most challenging developing countries—a private sector perspective on what is required to bring investment and expertise to partner with governments in providing vital infrastructure services.

There is already a substantial body of work on the potential of PPPs and how to design, finance, and implement them—even in countries where there are limited legal and regulatory frameworks on which to build. What compelled me to write my book is the urge to share, as a practitioner over two decades in some of the most challenging markets, common pitfalls I’ve seen and what appear to be the critical elements of success in creating successful and replicable PPPs.

Where to go for information on access to information

I get stirred up by all types of governance data, so in honor of the International Day for Universal Access to Information, I though I’d highlight a few efforts to measure access to information. Information on access to information, if you will.

PPP Cancellations: If you do not change direction, you may end up where you are heading (Lao Tzu)

In a previous blog, I used the metaphor of marriage to explore the dynamic of public-private partnerships (PPPs) as relationships created between two parties with often very different expectations and methods of communication.

Today, we explore PPP cancellations, the what and why— further stretching the marriage metaphor. Cancellation of a PPP is a bit like divorce: rarely easy, often painful, and generally expensive.

The worst reconciliation is better than the best divorce – Miguel De Cervantes Saavedra

Muskets, PPPs, and standardization

BRJ INC | Flickr

In the 18th century, muskets were produced by skilled craftsmen, one piece at a time. Each component was individually forged, filed, and worked—like a piece of art—until they could all be put together into a single weapon.

Today, the limitations of this approach are apparent. The cost and time required to produce each musket were high, and replacement parts had to be made by hand. This method was replaced by production with interchangeable parts in the early 19th century, a process advanced by Eli Whitney, an inventor who produced arms for the U.S. government.

Let’s realize the potential of PPPs

Photo: rawpixel.com | Pexels

If the potential of public-private partnerships (PPPs) is to be realized, joint working within the public sector and between the public and private sectors needs to be improved.

Experience across the world has consistently identified that organizations find it difficult to effectively work together both within and across sectors. Issues of organizational objectives and priorities, individual and organizational sovereignty, status, power, resources, and culture act as barriers. This too often means that the potential outputs and outcomes from PPPs are not maximized.

Honduras launches new PPP disclosure portal

This past spring, Honduras took an important step in improving transparency and accountability with respect to Public-Private Partnerships (PPP) by launching an online platform that allows public access to detailed information about these activities.

The portal, created with the support of the World Bank and in coordination with the Construction Sector Transparency Initiative (CoST), allows access to information related to PPP projects through their entire project cycle. This is a significant achievement that promotes transparency in PPP planning, procurement, implementation and monitoring in Honduras, by making information easily accessible to citizens.

What’s the latest research on the quality of governance?

Last week I attended Stanford University’s Quality of Governance conference, expertly organized by a rising star of the field, Saad Gulzar. I thought I’d follow in the footsteps of Dave Evans and others and summarize the findings of the papers presented. They provide a sketch of the frontier of research on state capacity.

Populism and development policy

Populism – the idea that a particular social group speaks for the nation as a whole, and should be first in the line for social benefits – threatens the core values of the post-World War order. It also challenges the World Bank’s own approach to development policy. As the world prepares for the 50^th anniversary of the signing of the Universal Declaration of Human Rights with a year-long commemoration, culminating on December 10, 2018, we at the World Bank can use the occasion to reflect on our commitments and uphold them courageously.

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