Regenerative PPPs (R + PPP): Designing PPPs that continue to deliver


Foto: Misako Kuniya | Flickr Creative Commons

It is the right time to explore innovative ways to implement PPPs through a synthesis of sustainable and sustainable best practices that progressively improve delivery and exceed initial expectations

During my recent trips as PPP advisor for Europe, the Middle East and Southeast Asia, I worked closely with public sector leaders increasingly focusing on the acquisition of a new generation of PPPs are sensitive, focused, and will support their governments’ goals of achieving Sustainable Development Goals (SDGs).

A government official in the Balkans has been worried about the maturing of PPPs in his country. Projects launched at the end of communism have reached the end of their lives and would be in a bad state when they returned to government by private sector partners who did not fulfill their obligations to ensure operations and government maintenance has received projects back in good working order. In addition, there is concern that if the perception would have been that PPPs would have led to «privatization of profits and nationalization of debts,» the potential for future PPP projects would have jeopardized

These projects, which could stop when returning to the public sector due to lack of financial and human resources, would determine the country’s development agenda as it could not afford to build new projects and renew the old ones at the same level

In this context of uncertainty about the significance of PPPs and their capacity to genuinely serve the aspirations of SDGs, donor organizations and international development

(19459002) At a recent Symposium of the Center for Strategic International Studies (CSIS) Hartwig Schafer, World Bank Vice President for Global Theses, participated in a PPP group session focused on this topic. Its sincere support for more effective delivery of PPPs as an instrument of economic development that addresses and eliminates poverty and stimulate common prosperity is encouraging. I think this can only be achieved if PPPs continue to deliver them after the expiration date

Regenerative PPPs

] In order to implement R + PPPs, a change of mentality must take place by PPP architects. New considerations include:

Flexible agreements that include clauses that can redirect projects to fit perfectly with unpredictable changes such as economic, political, environmental, and climate change
Introducing incentives that encourage the adoption of new innovations and technologies beyond
Developing a Best Practice Mechanism that constantly recalibrates projects to accommodate the potential challenges of technology and facility wear — a real threat in terms of increasing delivery times for projects on a lengthy basis. (and refinancing) that are promoted by responsible investors interested in providing projects (both infrastructure and services) that can be sustained beyond their initial performance period
Providing PPPs that are proactively adaptable and produce better results under «myopic» ideas that ex
Synthesize sustainable and resilient practices in a new generation of practices that create infrastructure (and services) that are regenerative and do not need to be rebuilt
Identify transparency and competitiveness procurement procedures that allow traditional operators performing exceptionally performance of PPPs to continue to deliver projects if they exceed delivery targets
Exploratory mechanisms that increase the renewable viability of projects transferred to the public sector at the end of the contractual execution period

I think we are capable of adopting a new development horizon, supported by human exponentially developing knowledge that can implement PPP funding for infrastructure projects (and services) that can become renewable and last long as they are useful.

Detractors may say that it is too costly to develop projects with these fundamental expectations. I wonder, would not it be better to embrace the regenerative projects that continue to happen than to return to the drawing plan every 30 years to launch a replacement project?

It seems counterproductive to focus on projects that have a finite design life when we can focus on innovative PPP projects that are genuinely regenerative. The United States would not have the infrastructure crises it currently has if the projects built 50 years ago have embedded regenerative practices.

The time is running out. Financial and capital resources are rarer as population and climate pressures increase. Now is the time to explore the PPP delivery mechanisms that generate all PPP project blocks during their lifetime — and beyond — so do not worry about the expiration of the contract and the expiration of the facility.

Please share your thoughts with me below

The original version of this blog appeared on LinkedIn’s page David Baxter.

Disclaimer: The content of this blog does not necessarily reflect the views of the World Bank Group, the Board of Directors, the staff or governments they represent. The World Bank Group does not guarantee the accuracy of the data, findings or analyzes of this post.

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