The Caribbean Development Bank (CDB), in cooperation with its development partners, the World Bank (WB), the Inter-American Development Bank (IDB) and its Multilateral Investment Fund (MIF), and the Public Private Infrastructure Advisory Facility (PPIAF), has established a US$1.2 million Regional PPP Support Program (the Program), based in CDB’s Barbados headquarters.
Given the high infrastructure needs and severe fiscal challenges faced by countries in the Region, policy-makers are increasingly turning to Public-Private Partnerships (PPPs), as a means of delivering infrastructure services. Regional governments would therefore benefit from receiving practical assistance in adopting sound PPP policies, and advisory assistance to implement projects.
PPPs are still relatively new to the Caribbean. Over the past ten years, some PPPs have been successfully implemented, delivering high-quality infrastructure facilities and providing value for money to both governments and consumers alike. However, in many cases, the complexity of the transaction process - and lack of capacity within governments - has meant long delays in delivering projects; many of which languish for years and ultimately fail to launch.
With support from its multilateral development partners, CDB has launched a first phase of activities, designed to assist its Borrowing Member Countries in the development and implementation of PPPs. These include:
Strengthening the enabling environment:
- Developing a Caribbean web-based PPP Toolkit
- Seminars and workshops to increase technical capacity among governments
- Quick-response to ad-hoc technical requests
- In-country support to introduce PPP policies and programmes
- Screening and developing of potential projects
Business plan for PPP Facility
- Estimating demand for advisory assistance and investment needs
- Defining the scope of services to be offered by the Facility
- Funding mechanisms for project preparation costs
Eventually, the aim is for the PPP Facility to comprise a PPP implementation team that will work with governments to develop and implement sound policies and transactions. The costs of the PPP team, and external advisors engaged to support projects, will be covered by a revolving fund such that the PPP Facility will be sustainable over time.
This fund would be replenished by revenues arising out of the transaction processes; both from contributions from governments; as well as cost recovery mechanisms from winning bidders, who will be contractually obligated to repay the PPP Facility for the cost of project preparation.
CDB is the primary implementing agency for the PPP Facility. Substantial technical support will be provided by CDB’s multilateral development partners, while the PPP team builds its technical capacity. This will include financial contributions, plus technical support from specialist consultants.
This important initiative demonstrates the ongoing commitment of CDB and its multilateral development partners, to promote the provision of infrastructure services in the Caribbean Region, utilizing the modality of PPPs.
- Christopher Barton