global experiences of public private partnership lessons for bangladesh abdullahil mamun

7/27/2019 Global Experiences of Public Private Partnership Lessons for Bangladesh Abdullahil Mamun

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GLOBAL EXPERIENCES OF PUBLIC PRIVATE PARTNERSHIP: LESSONS FORBANGLADESH

1) Abdullah Mohammad Ahshanul MamunLecturer

Department of Business Administration

International Islamic University Chittagong

Bangladesh.

e-mail:[email protected]

2) Nazamul HoqueAssistant Professor



Bangladesh.


3) Abdullahil Mamun

Assistant Professor



Bangladesh.


4) Manjur Rashad Masum

Lecturer


University of Information Technology and Sciences

Bangladesh.


Abstract

Public private partnership (PPP) is no more considered as a trial and error concept rather it is

applied widely around the world as a tested and successful means in facilitating the delivery of

high quality goods and services. But the efficient utilization of PPP is a challenging job. In this

paper a thorough review and evaluation has been done on the experiences of PPP of different

developed and developing countries of the world in order to identify the critical factors of PPP to
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provide necessary guidelines to the key stakeholders of Bangladesh considering its context with aview to accelerate the wheel of economy through proper utilization of different successful models

of PPP.

Key Words: Public Private Partnership, Bangladesh.

Introduction:

Public private partnership (PPP/P3) is getting

attention as an attractive field of research during the

last few decades (Jimnez and Pasquero, 2005)

because PPP is being considered as an alternative

institutional arrangements and modes of delivery of

public goods and services (Jamali, 2007, Wettenhall,

2003, Hodge & Greve,2005).The primary objective

of PPPs is to facilitate the delivery of high-quality

public facilities and services by the private sector

over an extended period of time at a cost that

represents value for money, whilst at the same time

transferring an appropriate level of risk to the private

sector (Lane and Gardiner, 2003). PPPs imply a sort

of collaboration to pursue common goals, while

leveraging joint resources and capitalizing on the

respective competences and strengths of the public

and private partners (Widdus,2001; Pongsiri, 2002;Nijkamp et al., 2002). PPPs can also work for a range

of infrastructures including transportation, water and

sewer services, solid waste disposal, municipal

parking, and social infrastructure such as schools,

hospitals, and other public buildings. These include

education, housing, health care, transportation, social

care and many other areas commonly associated with

the public sector (Grimsey and Lewis, 2002).

European Commission (2004), in its green paper on

PPPs, recognized some common elements of a PPP:

long duration cooperative relationship, complex

arrangement of shared funding and participants role

at different stages in the project and shared risk. Most

supposed PPPs in third world development do not

seem to meet this criterion. Donor agencies often

promote privatization and government subsidies to

private entrepreneurs in the name of building PPPs.

However, privatization and subsidies should not be

confused with PPPs (Mitchell-Weaver and Manning,

1991).

Indeed, though PPP was originally treated as a

derivative of the privatization movement, there is agrowing consensus today that PPP does not simply

mean the introduction of market mechanisms or the

privatization of public services. PPP is an

institutionalized form of cooperation of public and

private actors, who work together towards a joint

target on the basis of their own indigenous objectives

(Nijkamp et al., 2002). According to Jamali (2004),

Pongsiri (2002), Nijkamp et al., (2002) and Widdus

(2001), PPP is a sort of collaboration to pursue

common goals by leveraging joint resources and

capitalizing on the respective competences and

strengths of the public and private partners. Indeed,the nature of relationship between the public and

private sectors is seen on the dimension of five types

of activities namely- parallel activities, competitive

activities, complementary & collaborative activities

(Ravindran, 2002), and Contractual activities (Clifton

& Duffield, 2006). PPP is the collaboration in which

the public and private sectors both bring their

complementary skills to a project, with different

levels of involvement and responsibility, for the sake

of providing public services more efficiently

(Efficiency Unit, 2003b). It is a relationship thatconsists of shared and/or compatible objectives and

an acknowledged distribution of specific roles and

responsibilities among the participants which can be

formal or informal, contractual or voluntary, between


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Table 1: Probable Public-Private Relationship

Dimension 100% Public (1) (2) (3) (4) (5) (6) (7) 100% Private (8)

Control Public Public Public Public Private Private Private Private

Finance Public Public Private Private Public Public Private Private

Ownership Public Private Public Private Public Private Public Private

Source: Constructed by authors

The above table shows a probable set of relationshipbetween Public and Private on three dimensions

ranging from (100% Public) State-owned enterprise

to (100% Private) Privatization. So there exist six

options where public and private can share the

ownership, control and finance between them as a

form of Public private partnership (PPP/P3). It shows

a greater involvement of private may be possible for

option 4, 6& 7 (Dimensions taken from: Zarco-Jasso,

2005). Depending on the mode of entry, ultimateownership, risk sharing, and duration of the

partnership PPPs may take a wide range of

contractual forms that can be combined into four

main types: Greenfield, divestiture, concessions, and

management contracts (Glambotskaya et al., 2007).

Characteristics of Main types of PPP are (given in

table 2) as follows:

Table 2 : Characteristics of Main types of PPP

Types of PPP Acronym Modes of

Entry

Operation and

Maintenance

Investment Ultimate

Ownership

Market

Risk

Duration

(Years)

Build, Own and

Transfer

BOT Greenfield Private Private Semi-

private

Private 20-30

Build, Own,

Operate and

Transfer

BOOT Greenfield Private Private Semi-

private

Private 30+

Build, Own and

Operate

BOO Greenfield Private Private Private Private 30+

Build, Lease and

Own

BLO Greenfield Private Private Private Private 30+

Partial

Privatization

Divesture Private Private Private Private 30+

Full Privatization Divesture Private Private Private Private Indefinite

Rehabilitate,

Operate and

Transfer

ROT Concession Private Private Public Semi-

private

20-30


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Rehabilitate,Lease/ Rent and

Transfer

RLRT Concession Private Private Public More-private

20-30

Build,

Rehabilitate,

Operate and

Transfer

BROT Concession Private Private Public Private 20-30

Management

Contract

Contract Private Public Public Public 3-5

Leasing Contract Private Public Public Semi-

private

8-15

Source: Glambotskaya et al. (2007)

PPP can be a good tool for developing sustainable

infrastructure and thereby ensuring and accelerating

the wheel of economy of Bangladesh. Access to

electricity, improved sanitation facilities, telephone

subscribers are 20%, 36% and 14% respectively all

the indicators are below the South Asia Average

according to comparative infrastructure indicators

(World Bank Database, 2011). The current rate of

investment is much lower (24.5%) than the required

rate (around 35%-40%) the government seeks and

what is necessary for Bangladesh to meet its goals(Bangladesh Gadget, 2010; Mamun, Islam 2010).

Situation has worsened in recent years, with the

decline in availability of private sector investment for

infrastructure (World Bank, 2013). Therefore, this

paper is an effort to point out the interesting lessons

for Bangladesh from the experiences of different

countries around the globe considering the context of

Bangladesh. Different critical success factors of PPP

are identified so that Bangladesh can successfully

implement with a view to maximize the benefits from

PPP. While writing the paper, the researchers have

reviewed available published articles, case studies,reports, conference papers, archival records and

books regarding Public Private Partnerships

experiences of different developed and developing

countries of the world.

Public Private Partnership: World Experiences

Various forms of PPP have been implemented in

countries of the European Union, Australia Central

America, North America, South East Asia and Africa

for over 30 years. Between 1990 and 2009 more than

1300 PPP contracts were signed in the EU,

representing a capital value of more than EUR 250

billion. This includes roughly 350 new projects with

a value of almost EUR 70 billion having reached

financial close since the beginning of 2007 (EuropeanInvestment Bank,2010).

Table-3 provides a picture of infrastructure projects

in different region by primary sector. Projects include

management or lease contracts, concessions,

greenfield projects, and divestitures. The database

contains almost 5,000 projects dating from 1984 to

2011.

Table-4 provides a description of infrastructure

projects in low- and middle-income countries byprimary sector. Projects include management or lease

contracts, concessions, greenfield projects, and

divestitures. The database contains almost 5,000

projects dating from 1984 to 2011.


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Source:WorldBank PPI database, 2013

China, India, Brazil and Russian federation are

holding the 1st, 2nd, 3rd and 4th position respectively

considering the number of PPP projects during 1984-

2011. On the other hand Brazil India, Russian

federation and China are holding the 1st , 2nd , 3rd and

4th position with respect to total investment (US$

million) in PPP projects during the same period

(World Bank PPI data base, 2013).

The government defines success for PPP projects as

being built on time and within budget (Nick Sciulli,2008). A successful PPP is one thatprovides theservices the government needs, offers value for

money as measured against public service provision

(where value for money is measured by the net

present value of lifetime costs, including the cost of

risk bearing)and complies with general standards of

good governance and specific government policy

such asIs procured with transparent and competitive

procurement being fiscally prudent complying

with the legal and regulatory regimes that apply to

the industry in which the PPP will exist. (World

Bank, 2007). PPPs therefore should not be expected

to substitute for action or responsibilities that

properly rest elsewhere. In particular, the public

sector should continue to set standards and monitor

product safety, efficacy, and quality and establish

systems whereby citizens have adequate access to the

products and services they need. (Jamali, 2004) In

Table 4 : infrastructure projects in low- and middle-income countries by primary sector

Featured Indicator,

(1990-2011) Energy Telecom Transport Water and

sewerage

Number of countries

with private

participation

107 135 86 62

Projects reaching

financial closure2283 822 1371 762

Region with largest

investment share

Latin America and

the Caribbean (35%)

Latin America

and the Caribbean

(37%)

Latin America

and the Caribbean

(40%)

East Asia and

Pacific (46%)

Type of PPI with

largest share in

investment

Greenfield project

(65%)

Greenfield project

(60%)Concession (55%) Concession (60%)

Type of PPI with

largest share in

projects

Greenfield project

(72%)

Greenfield project

(74%)Concession (57%)

Greenfield project

(42%)

Projects cancelled or

under distress

117

representing 5% of

total investment

59

representing 3%

of total

investment

77

representing 6%

of total

investment

63

representing 32%

of total

investment
http://ppi.worldbank.org/explore/ppi_exploreRegion.aspx?regionIDhttp://ppi.worldbank.org/explore/ppi_exploreRegion.aspx?regionIDhttp://ppi.worldbank.org/explore/ppi_exploreRegion.aspx?regionIDhttp://ppi.worldbank.org/explore/ppi_exploreRegion.aspx?regionID


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of almost double the average available in the marketand more than triple the cheapest alternative at a rate

of return of 30 per cent. This rate can be compared to

the 3 per cent return state-owned power agencies aim

for in India. (Palast, Oppenheim, and MacGregor,

2003).

Enron was in the water business for only three years,

through an entity called Azurix that it created in

1998, operated in Buenos Aires, Ghana and Canada-

was fined for frequent interruptions, releasing

untreated effluent, and exceeding allowed effluent

levels, suspicions of corruption , severe violations of

environmental law etc.(Public Citizen,2002).

Metronet represents a recent, and very big,

infrastructure PPP failure. It was divided into two

PPPs (BCV and SSL), the London underground P3s

are collectively known as Metronet was a 15.7

billion P3, signed in 2003 and personally championed

by the then Chancellor of the Exchequer, Gordon

Brown, collapsed in 2007. Various problems like

goal conflict, risk sharing and higher debt to equity

ratio prevail there. Most importantly, there existed

five giant equity participants as well as supplier ofthe project who transfer their risk to another stand-

alone corporation owned by the other four equity

partners- make it harder to assign responsibility

(Vining and Boardman, 2008).

There exist many other examples of PPP failure

including Rio Light Company in Rio De Janeiro,

Brazil. Reports of corruption, fail to meet the public

interest, Job cut, price hike, cancellation of contract,

bribery, hearing, punishment etc. are common

phenomenon in not only private power sector but also

in water projects surfaced in Indonesia, India,

Pakistan, Uganda, Lesotho, Guinea, Argentina, SouthAfrica, Germany, Turkey, England, Czech Republic,

Hungary and Poland and Peru by renowned

companies working in PPP project around the World.

(Palast, Oppenheim, and MacGregor, 2003). Backer(2003), sees Enron as a PPP, demonstrates the danger

of loosing control of public regulators over private

sector. Many transnational private utilities are larger

than most national economies (Beaulieu, 2003).

Indias unhappy experience with Enron and Bechtel

illustrates, the odds are much longer in the

developing world that public-private partnerships will

result in benefits to the public. (Oppenheim and

MacGregor, 2004). This stream of literature generally

indicates that partnerships are high-risk strategies,

particularly at the level of implementation; however,

the advantages and/or mutual benefits, when

successful, by far outweigh the risks involved

(Hagen, 2002; Horton, 1998).

Critical Factors of Public Private Partnership

Development

Ibrahim, Price and Dainty (2006) identified sixty-one

PPP risk factors from literature and classified into

exogenous and endogenous risks. They focused on

three most important PPP risk factors in Nigeria,

thats are unstable government, inadequate

experience in PPP and availability of finance thatare most relevant to Bangladesh perspective. Those

critical factors are related to development and

implementation of PPP. Those factors are given

bellow along with the researchers.


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Public Private Partnership in Bangladesh:Though not so rich, Bangladesh has experiences of

PPP, especially in respect of the scope and diversity

of Non-Government Organization (NGO) activities in

social services. (Bhattacharya, Rahman, 2010). But

the scenario of PPP in primary project is not up to

required level. The Government through its national

budget FY 2009-10 introduced the concept of PPP

budget and the new industrial policy 2010 also

reflects the governments intention for rapid

industrialization through Public Private Partnerships

(Bhattacharya, Iqbal & Khan, 2009). Implementation

and funding of infrastructure development projects is

a long drawn process and investment risk is much

higher, the investment is not, in many cases,

commercially viable (Hodge and Greve, 2009). As a

heavily populated country with a population of

around 150 million living on a land area of 147570

square kilometer, Bangladeshs economy is

dependent mainly on agriculture, which accounts for

around 18.43% of GDP, but provides employment to

as much as 47.3% of the countrys labor force

(Bangladesh Bureau of Statistics, 2010). Due to

unfavorable land-man ratio and the under-developed

state of the countrys agriculture sector, the key to thegeneration of productive employment lies in strong

economic growth through the structural

transformation of the economy away from agriculture

and toward industry (Bhuyan, 2005). There are three

major options for infrastructure delivery (although

each has many variations): direct public provision,

contracting-out (i.e., design, build, transfer), or

publicprivate partnerships (P3s) (Vining and

Boardman, 2008). A new way for Bangladesh need to

improve for its infrastructure development keeping in

mind the governments low capability to finance its

immediate infrastructure like power, health, energy

etc. And public-private partnerships (PPP) may be a

solution basing on the experience of foreign

countries.

Indeed, Bangladesh has a very few PPP projects in all

the primary sectors. Projects include 38 Greenfield

projects, 5 management or lease contracts and 3

divestitures containing almost 46 projects dating

from 1990 to 2011. The snapshot of are given

(table:6) bellow-

Table 6 : Infrastructure projects in Bangladesh under PublicPrivate

initiative (PFI) during 1990-2011

Sector Sub-Sector Number of Projects Total

Investment

(US$ million)

Energy Electricity 28 1,688

Natural Gas 1 31

Total Energy 29 (Green field 26,

Divestiture 3 )

1,719

Telecom Telecom 12 6,593

Total Telecom 12 (Greenfield 12) 6,593

Transport Airports 1 0


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Roads 2 0Seaports 2 0

Total Transport 5 (Management

Contracts 5 )

0

Water

and

Sewerage

- - -

Total 46 8,312

Source: World Bank PPI database, 2013

It is difficult to attract private investment in all

projects. Through the Public-Private Partnership

(PPP) initiatives, a recently introduced innovative

scheme, government involves the private sector to

meet the probable investment gap in infrastructure

development, especially power and energy;

telecommunication and port development have been

given the highest priority, which will provide a boost

to every sector of the economy Using some proven

schemes such as Public Private Partnership

(PPP/P3s) to provide the basic infrastructure is

essential for countries like Bangladesh to generate

required investment to meet the millenniumdevelopment goals (Mamun & Islam, 2010). As small

taxing powers against GDP (10%, 2008-2012),

(World Bank, 2013) and inefficient scale in both

technical expertise and risk assessment, Government

of Bangladesh requires minimizing the infrastructure

deficit where P3 can be a significant alternative.

On the other hand, Tillmann, Robert and Wang

(2007) compared the levels of perceived risks versus

the PPP opportunities and show that while Cambodia,

Bangladesh, and Pakistan are perceived most risky

and promising least PPP opportunities, Indonesia,

China, India, and Thailand are also perceived

relatively risky put promise comparatively high-PPP

opportunities. The least exposed to political risks are

the matured economies of Korea, Japan and

Singapore and they rank middle regarding PPP

opportunities.

PPP activities/Infrastructure in Bangladesh:

The Infrastructure Investment Facilitation Center

(IIFC) was established in 1999 to promote and

facilitate private sector participation in infrastructure

in Bangladesh. IIFC was established to have a policy

role and a transaction advisory role, and to adviseboth the public and private sectors. Another

institution, the Infrastructure Development Company

Ltd (IDCOL) was established concurrently with IIFC

to provide government debt financing for

infrastructure projects. IIFC and IDCOL are

government-owned, limited liability companies. They

were established with financial support from The

World Bank, and other donors. IIFC, in particular,

received support in the form of consulting services

sponsored by the Canadian International

Development Agency (CIDA), and Department for

International Development (DfID), UK support

(World Bank ,2009).


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Table 8 : Comparison among the Large ,medium and small PPPs related policies and strategies of Bangladesh Phase Required weeks

Large Project

( Above BDT 2.5 Billion )

Medium Project (Between

BDT 2.5 billion-BDT 500

million)

Small Project (Below BDT

500 million )

Project

Identification

On-going On-going On-going

In-principle

Approval

24 weeks 24 weeks 24 weeks

Feasibility Study 820 weeks 612 weeks 48 weeks

Request for

Qualification

48 weeks 48 weeks -

Request for

Proposal (RFQ),


Negotiation and

Contract award


Other Comparisons

Project

Identification by

Line Ministry, Implementing

Agency, Office of PPP (PPPO)

Private Investor

Line Ministry, Implementing

Agency, Office of PPP

(PPPO) Private Investor

Line Ministry, statutory

authorities and other entities

under its administrative

control; Implementing

Agency, Office of PPP

(PPPO) ,Private InvestorPre-Feasibility

Study

Pre-Feasibility Study by PPPO

for each project

Pre-Feasibility Study by

PPPO for each project

Private investor may submit

unsolicited proposal with

Pre-Feasibility Study by

Unsolicited

proposal

If the RFQ is based on an

unsolicited proposal the

initiator of the said proposal

will be treated as automatically

pre-qualified.

If the RFQ is based on an

unsolicited proposal the

initiator of the said proposal

will be treated as

automatically pre-qualified.

No need to call for RFQ.

Line ministry and

implementing agency

directly issues RFP.

In-principle

approval by

Cabinet Committee on

Economic Affairs (CCEA)



Line minister

Request for

qualification

requirement

Line Ministry/implementing

agency calls for RFQ.

Line Ministry/ implementing

agency calls for RFQ.

The line Ministry/

implementing agency issues

RFP, with appropriate

modifications by the Office

for PPP, if required, to the


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shortlisted private investors.No need to call for RFQ.

Technical

effectiveness

The relevant Qualification and

Tender Evaluation Committee

(QTEC) evaluates the

investors proposals based on

the technical responsiveness

criteria and screens out the

non-responsive proposals.

The relevant Qualification

and Tender Evaluation

Committee (QTEC)

evaluates the investors

proposals based on the

technical responsiveness


non-responsive proposals

.The private investor, whose

proposal went for RFP,

qualifies automatically for

technical responsiveness.

The relevant Qualification

and Tender Evaluation

Committee (QTEC)

evaluates the investors

proposals based on the

technical responsiveness


non-responsive proposals

.The private investor, whose

proposal went for RFP,

qualifies automatically for

technical responsiveness.

After vetting by

Legislative and

Parliamentary

Affairs Division

line ministry/

implementing

agency seeks

approval of



Finance minister Line Minister

Final approval by Cabinet Committee on


Finance Minister Line minister

Source: PPP documents, 2010, Ministry of Finance, Bangladesh

The relationship among Office of PPP (PPPO),

Cabinet Committee on Economic Affairs (CCEA),

Parliamentary Affairs Division (PADs), line ministry/

implementing agency are complex, bureaucratic and

sometimes vague. Most critical part of a PPP

documents (Detailed feasibility study, Request for

qualification, request for proposal etc.) is to be

written by consultant, but their selection requirements

is not clearly mentioned at the policy and strategy

paper 2010.

Few Infrastructure related projects Bangladesh has

taken under PPP are: Grameen Phone Network

Expansion Project, Pacific Telecom Network

Expansion Project, Ranks Tel PSTN Project, DNS

Satcomm Satellite Earth Station Project, BanglaTrac

International Communication Gateway Project, M &

H Telecom Interconnection Exchange Project, and

Shoanchalok ICT Programme (Hasan, 2012). Their

service and performance are yet to evaluate. Some

other PPP projects in Bangladesh include-

Automation of Railway reservation and Ticketing

System, Land records, Higher educational institution

admission, Results of public examination , Foreign

and local investment related information,

Government forms, and Payment of utility bills.


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Among the identified services, results of publicexams, government forms and payment of utility bills

were implemented successfully and scaled up.

A latest PPP project, Build-Own-Operate and

Transfer (BOOT) model, without GOB Finance

Chittagong Custom House Automation Project

partnering with Data-soft to double the revenue, to

reduce cost of doing Business by at least 70% , to

save customs processing time by 80% has taken by

Bangladesh (Hossain, Deb, & Al Amin,2009).

Because of successful automation solutions provided

by DataSoft, the 42 steps lengthy process has been

curtail to only 6 steps, bill of entry cost reduced BDT

180 to BDT 50, Cargo Handling, Auction, Banking

everything came under the automatic solutions.

Stakeholders including BGMEA, Importer &

Exporter, Off Dock, EPZ, Shipping Agents, NBR,

Custom Intelligence, Custom Bond, Freight

Forwarders, Navy, C & F Agents, PSI and all other

related stakeholders have came under the system of

Chittagong Custom House Automation Project

(Datasoft,2013).

Problems of Public private partnership developmentin Bangladesh are varied. Government has taken

huge initiatives and budgets. But there exist lack of

harmony, strong political will, political stability,

private sectors awareness, transparency, law andorder situation, social awareness regarding their

demand ,right & democracy and private sectors

intentions of taking risk etc. that impede the way

forward to reduce the infrastructure gap. From the

beginning the Padma bridge negotiation has been

involved to corruption and conspiracy. The World

Bank stated that they found, "credible evidence

corroborated by a variety of sources which points to a

high-level corruption conspiracy among Bangladeshi

government officials, SNC-Lavalin executives, and

private individuals in connection with the Padma

Multipurpose Bridge Project (World Bank, 2012).

For the corruption, the World Bank turned down to

sanction the proposed loan for constructing the

bridge. In these circumstances World Bank imposed

some conditions to continue the loan talk with the

government. Bhuyan, (2011) proposes transparent

mechanism and well-defined rules for participating in

and mobilizing funds for the PPP projects by

commercial banks, specialized financial institutions,

and international financial institutions to extend

credit on easier credit terms and a healthy capital

market. Figure-1 depicts a flow chart of PPP projectdevelopment in Bangladesh from the data of Policy

and Strategy for Public-Private Partnership, 2010.
http://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/SNC-Lavalinhttp://en.wikipedia.org/wiki/SNC-Lavalinhttp://en.wikipedia.org/wiki/SNC-Lavalinhttp://en.wikipedia.org/wiki/World_Bankhttp://en.wikipedia.org/wiki/World_Bank


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Figure 1: PPP process in Bangladesh

Source: Constructed by Authors

Phase # 01: Project Identification (On going) by

line ministry, office of PPP, private investor

Output of Request for Qualification(Evaluation report of short listed investors)

Phase # 02: In-principle Approval of PPP

project by CCEA

Output of Project Identification phase, (Both

Solicited and Unsolicited) pre-feasibility report

Stage: 02 Requests for Proposal

Stage: 01 Project Identification,

Formulation, Appraisal and Approval

Output of In-principle Approval of PPP project

(total in-principle approval list)

Phase # 03: Feasibility Study and Preparation of

documents by consultant panel, finance division

or Independent bidding process

Phase # 04: Request for Qualification (RFQ) by

line ministry, implementing agency, QTEC

Output of Feasibility Study and Preparation of

documents

Phase # 05: Line ministry/ implementing agencycall for Request for Proposal (RFQ), shortlisted by

Output of Monitoring and Evaluation

Periodic progress report by OPPP Monitoring and Evaluation report by line

Stage: 04 Monitoring and Evaluation

By line ministry/implementing agency and reports to officeof PPP taking key performance indicators as standard

Office of the PPP monitor compliance and reports to CCEA Principal Secretary, office of PPP and relevant ministry

resolve complexities etc.

Output of Request for Proposal (Evaluation r eport

containing shortlisted investors)

Phase # 06: Stage: 03 Negotiation and Contract award

Line ministry/ implementing agency negotiates with selectedbidder and send it for parliamentary affairs division (PAD)

for vetting

after vetting, seek approval from CCEA after approval Signs the contract by line

ministry/implementing agency

Output of Negotiation and Contract award

Vetting by parliamentary affairs division (PAD) Final Approval by CCEA Contract signed for implementation


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Conclusion and Policy implicationsIn conclusion it can be said that there are many PPP

development and success factors identified by many

researchers (Ibrahim, Price and Dainty , 2006 ;Vining

and Boardman, 2008; Esther Cheung, Albert P.C.

Chan, Stephen Kajewski, 2009; Di Lodovico,

1998;Pongsiri, 2002; Zouggari, 2002; Baker 2003

Wallin, 1997; Savas, 2000; Roseneau,2000; Widdus,

2001; Nijkamp et al., 2002; Spackman, 2002;

Scharle, 2002; Sussex, 2003;Zouggari, 2003; Jamali,

2004; Tillmann, Robert and Wang, 2007; Asia

Foundation , 2010) around the world out of which

many factors are also applicable to Bangladesh. That

includes but not limited to : (i) Hearty consultations

between the Public and private sector to start direct

dialogue on PPP, and to work out the specific issues

and recommendations, and operational implications

(ii) The operational mechanisms and procedural

guidelines should be worked out properly (iii) Legal

and regulatory issues in relation to PPP should be

sorted out (iv) Ensure effective representation of the

private sector in the PPP committees including the

Advisory Committee (v) Conduct policy research and

analysis on PPP issues and make recommendationsfor reform, and craft a PPP roadmap to be adopted by

the public and the private sector (vi) Ensure policies

and laws to enable PPP projects to continue

irrespective of changes in the political regime in the

country (vii) Avoid stand-alone private company and

make sure the proper allocation of risks among

parties (viii) Include different strategic partner like

The World Bank that may attract other development

partner of Bangladesh and give a favorable

environment for local private partners (ix) Activate a

proper stand against all sorts of Corruption &

nepotism and ensure transparent competitive biddingprocess (x) Integrate Corporate social responsibility

(CSR) fund of private and Annual Development

Program (ADP) Budget of Government to create a

non-profit ( social) PPP project that may

development the PPP environment. (xi) Convene aforum on PPP with participants from the private

sector, donors and civil society The scope of work of

the forum should include: (a) Promoting PPP in the

identified priority areas; (b) Assisting the government

in promoting good governance in PPP through open,

transparent, and participatory processes; (c) Assisting

the government in jumpstarting effective

implementation of five to six priority PPP projects

within the next six months in line with the PPP

guidelines; (d) Assisting the government in taking

forward necessary policy reform to promote effective

PPP; and (e) Assisting the government's PPP Unit in

developing a pipeline of bankable projects.

In fact, there is no single PPP model rather various

types of arrangements varying with regard to legal

status, governance, management, policy-setting

prerogatives, contributions and operational roles. For

the success, PPPs must begin with careful

groundwork and preparation, including a

comprehensive feasibility study and economic

evaluation for each potential partnership project. In

this respect, Bangladesh Government needs to build

its legal and regulatory capacity to effectively fosterand participate in PPPs (Jamali, 2004). Bangladesh as

a new entrant in PPP model of infrastructure and

service delivery has to consider the consequences of

previous PPP efforts in many developed and

developing countries. Many large corporate has as

much strength and evil background as to be cautious

regarding negotiation and contract awarding.

Arbitration procedure also has to be predetermined

and included in the contract document in

comprehensive manner. A vast PPP campaign and

assurance of political risk is the first task for

Bangladesh to ensure the effective participation ofPrivate sector. Proper training and skill development

of the public officials is necessary in this regard. A

centralized, corruption free, transparent and

competent PPP authority is compulsory for the


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34

ultimate infrastructure and service delivery throughPPP in Bangladesh. During the last 14 years

Bangladesh has developed many PPP policy paper,

but now this is time to develop a concrete single PPP

handbook that will facilitate all the PPP stakeholders.

Application of PPP model for developing

infrastructure of Bangladesh is in beginner level. So,

Bangladesh has an opportunity to grab late-mover

advantage here. Research works in this area in

Bangladesh context is relatively few and not well

addressed. Particular country issues need to be

focused more explicitly for Bangladesh. So, this is

an appropriate time to integrate the world experience

and apply such learning for the PPP development of

Bangladesh.

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global experiences of public private partnership lessons for bangladesh abdullahil mamun

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