Attracting Investors to African Public-private Partnerships : A Project Preparation Guide

As growth and development in Africa increase rapidly, investment in infrastructure projects will often be best accomplished through public-private partnership (PPP). Attracting Investors to African Public-Private Partnerships contains an assessment of the issues relevant when selecting a project for PPP and the actions involved with preparing projects for market, including how the process should be managed. It looks at hiring and managing expert advisers and explains how the public sector should interact with the private sector during the project selection and preparation phases to ensure that decisions during these phases are based on a realistic view of what the private sector can provide. Additionally, it analyzes the issues of engagement with the private sector during the tender and after a contract has been signed. This Guide offers the foundation blocks for public sector engagement with the private sector. CONTENTS......Page 6 ABOUT THE AUTHORS......Page 10 ABBREVIATIONS......Page 12 1. INTRODUCTION......Page 14 FIGURE 1.1 Number and Value of Private Participation in Infrastructure Projects, by Region, 1996–2006......Page 15 Scope of the Guide......Page 16 Limits to the Guide......Page 18 Privatization and Management Contracts......Page 20 Types of Public-Private Partnerships......Page 21 Policy Rationale......Page 26 Legal Framework......Page 27 Operating Framework......Page 29 Summary......Page 31 4. SELECTING PROJECTS......Page 32 FIGURE 4.1 Stages of Project Selection......Page 33 Expressing Projects in Terms of Outputs......Page 34 Can the Project Be Delivered as a Public-Private Partnership?......Page 36 FIGURE 4.3 Typical Contractual Structure of a Public-Private Partnership......Page 41 Initial Market Assessment......Page 42 Lessons from Private Sector Engagement in Projects in Africa......Page 43 5. PREPARING PROJECTS FOR MARKET......Page 48 Management of the Process......Page 49 BOX 5.2 Common Mistakes in Project Preparation......Page 54 Unsolicited Proposals......Page 55 Project Assessment......Page 56 When to Use Advisers......Page 60 Management of Advisers......Page 63 7. MANAGING THE INTERFACE WITH THE PRIVATE SECTOR......Page 66 Preparation for Market Sounding......Page 67 Before the Launch......Page 68 Role of Development Finance Institutions, Regional Investors, and Donors......Page 70 BOX 7.3 Major Concerns of Project Lenders......Page 72 Outcome of the Procurement Phase......Page 76 Bid Stages......Page 77 Project Launch......Page 79 FIGURE 8.2 Outline of the Prequalification Phase......Page 82 Request for Proposals......Page 84 Preferred Bidder and Financial Close......Page 87 9. AFTER SIGNING......Page 88 APPENDIX A. World Bank/PPIAF Private Participation in Infrastructure Project Database......Page 94 APPENDIX B. Sample Extract of a Risk Management Register for Managing the Public-Private Partnership Project Process......Page 98 APPENDIX C. Public-Private Partnership Web Sites......Page 100 APPENDIX D. Profiles of Five African Public-Private Partnership Projects......Page 104 Songas Processing Plant in Tanzania......Page 105 Maputo Port in Mozambique......Page 107 Skikda Desalination Plant in Algeria......Page 109 Lesotho National Referral Hospital......Page 111 Water and Electricity Services Provision in Gabon......Page 113 REFERENCES......Page 116 INDEX......Page 118 BOX 5.1 Common Problems in Project Governance......Page 53 BOX 7.1 Top 10 Tips for a Successful Market-Sounding Exercise......Page 69 BOX 7.2 Major Concerns of Contractors and Investors......Page 71 BOX 8.1 Project Information Memorandum......Page 80 BOX 8.2 Bidders’ Conference......Page 81 BOX 8.3 Summary of a Model Request for Qualification for Public-Private Partnership Projects, Government of India......Page 83 BOX 9.1 Tips on Contract Management......Page 90 FIGURE 1.2 Key Phases of the Public-Private Partnership Project Process......Page 17 FIGURE 4.2 Elements of a Risk Management Plan......Page 39 FIGURE 4.4 Number of Private Participation in Infrastructure Projects in Africa, by Sector and Type of Contract, 1996–2006......Page 44 FIGURE 4.5 Number of Transport Projects in Sub-Saharan Africa in World Bank PPI Database, by Sector, 1996–2007......Page 46 FIGURE 5.1 Project Preparation Process......Page 50 FIGURE 5.2 Outline of a Structure of Project Governance......Page 51 FIGURE 8.1 Outline of the Procurement Process......Page 78 FIGURE 8.3 Outline of the Request-for-Proposals and Financial Close Phases......Page 85 FIGURE 9.1 Structure of Contract Management......Page 91 TABLE 4.1 An Example of Output Specifications for an Accommodation Public-Private Partnership......Page 35 TABLE 6.1 Role of External Advisers......Page 61 TABLE 7.1. Checklist before Launching the Procurement Phase......Page 73 Role Of Public-private Partnerships 2 -- Scope Of The Guide 3 -- Limits To The Guide 5 -- 2 Defining Public-private Partnerships 7 -- Privatization And Management Contracts 7 -- Types Of Public-private Partnerships 8 -- 3 Setting The Framework 13 -- Policy Rationale 13 -- Legal Framework 14 -- Investment Framework 16 -- Operating Framework 16 -- 4 Selecting Projects 19 -- Project Scope And Requirements 20 -- Expressing Projects In Terms Of Outputs 21 -- Can The Project Be Delivered As A Public-private Partnership? 23 -- Value For Money 28 -- Initial Market Assessment 29 -- Lessons From Private Sector Engagement In Projects In Africa 30 -- 5 Preparing Projects For Market 35 -- Management Of The Process 36 -- Funding For Project Preparation 41 -- Unsolicited Proposals 42 -- Project Assessment 43 -- 6 Project Advisers 47 -- Role Of Advisers 47 -- When To Use Advisers 47 -- Appointment Of Advisers 50 -- Role Of Public-private Partnership Units 50 -- Management Of Advisers 50 -- 7 Managing The Interface With The Private Sector 53 -- Preparation For Market Sounding 54 -- Before The Launch 55 -- Perception Of The Project 57 -- Role Of Development Finance Institutions, Regional Investors, And Donors 57 -- Transition To The Procurement Phase 59 -- 8 Managing Procurement 63 -- Outcome Of The Procurement Phase 63 -- Role Of Advisers 64 -- Role Of Development Finance Institutions 64 -- Bid Stages 64 -- Project Launch 66 -- Prequalification 69 -- Request For Proposals 71 -- Preferred Bidder And Financial Close 74 -- 9 After Signing 75 -- A World Bank Private Participation In Infrastructure Project Database 81 -- B Sample Extract Of A Risk Management Register For Managing The Public-private Partnership Project Process 85 -- C Public-private Partnership Web Sites 87 -- D Profiles Of Five African Public-private Partnership Projects 91 -- Songas Processing Plant In Tanzania 92 -- Maputo Port In Mozambique 94 -- Skikda Desalination Plant In Algeria 96 -- Lesotho National Referral Hospital 98 -- Water And Electricity Services Provision In Gabon 100 -- 5.1 Common Problems In Project Governance 40 -- 5.2 Common Mistakes In Project Preparation 41 -- 7.1 Top 10 Tips For A Successful Market-sounding Exercise 56 -- 7.2 Major Concerns Of Contractors And Investors 58 -- 7.3 Major Concerns Of Project Lenders 59 -- 8.1 Project Information Memorandum 67 -- 8.2 Bidders' Conference 68. Includes Bibliographical References (p. 103-104) And Index.

As growth and development in Africa increase rapidly, investment in infrastructure projects will often be best accomplished through public-private partnership. This Project Preparation Guide offers the foundation blocks for public sector engagement with the private sector.

This book assesses the relevant issues for selecting a project for public-private partnership, the actions for preparing projects for market, and the management process The guide addresses hiring and managing expert advisers, explains how the public sector should interact with the private sector during the project selection and preparation phases to ensure that decisions during these phases are realistic, and analyzes the issues of engagement with the private sector during the tender and after a contract has been signed.

‘Attracting Investor to African Public-Private Partnerships’ will help the public sector in Africa to attract private sector investment through effective project advertising, management, and implementation. This book will enhance the chances of developing effective public-private partnerships by overcoming major obstacles to project delivery by having the right information, on the right projects, for the right partners, at the right time.

This guide is aimed at African public sector officials who are concerned about the delivery of infrastructure projects and services through partnership with the private sector, as well as staff in donor institutions who are looking to support PPP programs at the country-level.

Annotation As growth and development in Africa increase rapidly, investment in infrastructure projects will often be best accomplished through public-private partnership. This Project Preparation Guide offers the foundation blocks for public sector engagement with the private sector. This book assesses the relevant issues for selecting a project for public-private partnership, The actions for preparing projects for market, And The management process the guide addresses hiring and managing expert advisers, explains how the public sector should interact with the private sector during the project selection and preparation phases to ensure that decisions during these phases are realistic, and analyses the issues of engagement with the private sector during the tender and after a contract has been signed. Attracting Investor to African Public-Private Partnerships will help the public sector in Africa to attract private sector investment through effective project advertising, management, and implementation. This book will enhance the chances of developing effective public-private partnerships by overcoming major obstacles to project delivery by having the right information, On the right projects, For the right partners, at the right time. This guide is aimed at African public sector officials who are concerned about the delivery of infrastructure projects and services through partnership with the private sector, As well as staff in donor institutions who are looking to support PPP programs at the country-level 'As growth and development in Africa increase rapidly, investment in infrastructure projects will often be best accomplished through public-private partnership (PPP). This Guide offers the foundation blocks for public sector engagement with the private sector. The Guide contains an assessment of the issues relevant when selecting a project for PPP and the actions involved with preparing projects for market, including how the process should be managed. It looks at hiring and managing expert advisers and explains how the public sector should interact with the private sector during the project selection and preparation phases to ensure that decisions during these phases are based on a realistic view of what the private sector can provide. Additionally, it analyzes the issues of engagement with the private sector during the tender and after a contract has been signed.'--Publisher description