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sustainable development goals

When (and when not) to use PPPs

Shari Spiegel's picture


Photo: torstensimon | Pixabay

In the context of strained public finances and limited borrowing capacity for developing countries, there is growing debate on the roles of public and private actors to deliver the trillions of dollars of infrastructure necessary to achieve the Sustainable Development Goals (SDGs). On one hand, high-profile public-private partnership (PPP) project failures have cast doubt about the viability of the model. On the other hand, while public authorities are ultimately responsible for the delivery of public services, deficient infrastructure services in some countries have raised concerns about the ability of the public sector to deliver on its own.

This is not a black-and-white issue. Public and private finance are complementary, with different objectives and characteristics suitable in different contexts and sectors. The recently published 2018 report of the Inter-Agency Task Force on Financing for Development, to which almost 60 agencies and international institutions have contributed, explores this debate while analyzing financing challenges of SDGs 6 (clean water and sanitation), 7 (affordable and clean energy), 11 (sustainable cities and communities), and 15 (life on land/ecosystems).

Senegal shifts its thinking: Context is everything

Oumar Diallo's picture
Editor's note: this is the second in a two-part series. Click here to read the first part, "Senegal shifts its thinking: Rural water delivery moves to private operators."
 
Photo: flickr/Julien Harnels

In the rural water sector in Senegal, as with many parts of the world that have experienced tremendous changes, context is everything. Rarely does one single act spur a shift at the government level; many elements combine to prompt a change in approach.

The PPP team in Senegal was privileged to be able to develop a brand-new system for rural water delivery in Senegal (see previous post here), but our activity was just one contributing factor in a much larger national and even international effort. The political context in Senegal, along with sustained attention to the Millennium Development Goals (MDGs), created the right atmosphere for this PPP.   
 
Here are five important elements that came together to make Senegal’s paradigm-shifting PPP possible:
  1. Government officials’ forward-thinking views. Coming up with an original plan for the delivery of rural water depended on zoning changes. Our group’s internal study showed that dividing the country into three zones would make it possible to cluster services. Government’s willingness to consider clustering pipe systems across 14 regions was critical, because it made support from the private sector a viable option.

Achieving trillions out of billions

Bertrand Badré's picture

The release of the joint statement “From Billions to Trillions: Transforming Development Finance” at our Spring Meetings is one of the most satisfying moments during my two-year tenure as Managing Director and World Bank Group CFO.

My one regret is that the title should have been Billions for Trillions.

Why?

Financing the Sustainable Development Goals (SDGs) will require everyone to make the best use of each dollar from every source, and to draw in and increase public and private investment. The SDGs are ambitious and demand equal ambition in using the “billions” of dollars in current flows of Official Development Assistance (ODA) and all available resources to attract, leverage and mobilize “trillions” in investments of all kinds —public and private, national and global.

The traditional foundation of ODA, estimated at US$135 billion a year, provides a fundamental source of financing, especially in the poorest and most fragile countries. But more is needed. Investment needs in infrastructure alone could reach up to $1.5 trillion a year in emerging and developing countries.