Public-Private Partnership in Infrastructure (PPPI) Days 2008 and Capacity Building Events

PPPI Days 2008, and three PPPI capacity building events—the PPPI Workshop, the PPPI Showcase, and a workshop on Managing Public-Private Partnership (PPP) Advisors, were organized in collaboration with the World Bank Institute (WBI) and held in Washington, D.C. The events were specifically programmed to strengthen the PPPI network, facilitate knowledge sharing among participating PPP agencies, and promote a better understanding of the PPPI challenges faced by emerging economies to address policy agendas that need to be pursued to accelerate private sector investment and participation in infrastructure development worldwide. PPPI Days 2008 and the PPPI capacity building events welcomed executives of PPP units and leading senior public sector PPP and/or infrastructure policymakers and program managers from countries across the Asia-Pacific region and globally. Over 180 delegates representing more than 65 countries attended, which was the largest turnout ever for the annual PPPI Days event.

As a prelude to the main conference, the PPP Workshop on 15 December 2008 provided an overview of key PPP concepts and the basic elements of an enabling legislative and fiscal framework for PPPs, as well as a profile of global best practices for their establishment, for countries in the first stages of implementing a PPP program. During his welcome address, Sanjay Pradhan, Vice President of WBI, emphasized that while the impact of the global financial crisis on PPPI is still being assessed, the fundamental components of PPPs— delivery of quality service, capturing efficiency gains through private sector participation, and sharing risks—will be as important as ever. He indicated that in this challenging environment it is even more important for the lessons learned by mature PPPI programs worldwide to be shared with those who are embarking on, or in the initial stages of launching their PPPI programs and/or projects.

The PPPI Conference on 16-17 December was the third in a series inaugurated by WBI in 2006 to foster worldwide exchange among policymakers on best practices in the design and execution of public-private partnerships for infrastructure. The conference took place against the backdrop of one of the most serious global economic and financial crises witnessed in recent history. Given the challenging new context, the conference agenda was reconfigured to place a major emphasis on the implications of the crises on the global PPPI market, particularly for emerging market economies. In response to specific interests of the Global PPPI Network, a number of issues of current relevance were profiled including: PPP project design that focuses on value for money and performance delivery; ensuring project bankability and managing of financial close; and risk mitigation and how to make best use of guarantee instruments in PPP transactions. The conference was concluded with a round table discussion on how the potential of the PPP network can be expanded to benefit knowledge sharing and capacity building needs of PPPI professionals worldwide. Global views on what are the pragmatic capacity building needs of the PPPI practitioner community, particularly those from emerging market economies, were profiled.

The PPPI Showcase on 18 December was jointly opened by Ngozi Okonjo-Iwaela, Managing Director of the World Bank, and Rajat Nag, Managing Director General of the Asian Development Bank. Ngozi Okonjo-Iwaela underlined that ”we are in a global environment where we can no longer afford business as usual” … ”unless we intensify efforts to catalyze and leverage private capital in support of development, including through innovative public-private partnerships, we risk setting back our fight against poverty and progress towards the Millennium Development Goals.” Rajat Nag added that in dealing with the challenges of the global financial crisis, governments worldwide are facing greater fiscal constraints. Partnerships with the private sector, particularly for infrastructure, are always important for development and economic growth and will be increasingly so. He highlighted that in Asia, recovery measures to mitigate the slowdown in growth will depend heavily on investments in infrastructure and more efficient infrastructure service delivery. Reform measures to create the right business climate and regain investor confidence have begun in many countries across Asia and given key lessons on public private partnerships in Asia that have now emerged, PPPs are being mainstreamed in a number of countries across the region with India in the lead. Rajat Nag emphasized that it is not only the capital contributions from private sector partners that is critical to meeting Asia's infrastructure needs, but also the private sector's technical and management know-how.

The fourth and final day of PPPI Days 2008 afforded two additional knowledge sharing opportunities for conference attendees. The first addressed increased demands for global PPPI knowledge sharing where a multilateral PPPI capacity building initiative being spearheaded by ADBI, MIF-IADB, and WBI was introduced. The initiative is being designed to support a strong program of knowledge exchange on PPPI on many topical issues including the impact of the financial crisis. Through better dissemination and understanding of good global PPP practices, it is anticipated that stronger and better quality project pipelines will emerge, especially as the current crisis sharply reduces the volume of PPP project closings. In the second, global PPPI industry experts – representing private sector debt and equity investment funds, PPPI advisory services, and international rating agencies – shared their views on how current global capital market conditions might shape current and future market perceptions of PPP projects in emerging markets. The special private sector panel session provided a unique opportunity for private sector PPPI leaders to dialogue on the impact of the financial crisis, challenges ahead, lessons learned from previous financial crises, and pragmatic options for post-crisis infrastructure financing in emerging markets globally.

The third capacity building event—Managing Public-Private Partnership (PPP) Advisors: Key Issues Drawn from Lessons Learned—was offered on 19 December, closing the week-long program. PPP transactions can be complex for governments to manage, with unfamiliar concepts, multiple parties, and risk profiles that differ from traditionally procured infrastructure services. The workshop provided insight on the challenge of engaging the right advisors and managing the relationship. Panel members shared global practices and lessons learned on how to fully benefit from their engagement. The workshop also introduced the Infrastructure and Law website*, a new World Bank/PPIAF learning offering.

The five day event—PPPI Days 2008 conference and the three PPP capacity building events—was rated as highly relevant and pragmatic by the participating PPP executives, policymakers, and practitioners. Delegates appreciated the programs' focus on ensuring:

1. an in-depth view of PPP modalities and approaches to PPP project design and implementation that have been demonstrated across a wide range of country situations globally;
2. an emphasis on the priority policy and institutional actions that are needed to strengthen the legal and enabling environment and develop a pipeline of PPP projects in their respective countries;
3. opportunities for discussing shared PPPI issues and challenges with colleagues from other governments who are engaged in PPP policy development or project design; and
4. opportunities for consulting with and obtaining technical guidance from the over 60 PPP global experts and technical advisors who served as panel members and moderators.

* These links take you outside the ADBI.org website