PPP conversations: No. 1 with PPP Center
What do stakeholders have to say about public-private partnerships (PPPs)? What are their PPP stories? What are their roles and perceptions?
Starting today PPP Lead will feature PPP Conversations. This columnist will propound frequently asked questions to be answered by PPP stakeholders. Our first conversation will be with the PPP Center (PPPC), which will share with us its reason for being and its view on this developmental strategy.
- Agra: What is your concept of PPP?
PPPC: PPPs are contractual arrangements between the government and the private sector, intended to accelerate the delivery of infrastructure and development projects or services. Republic Act (RA) 7718, or the Amended BOT law and its implementing rules and regulations (IRR), generally govern PPPs in the Philippines, supplemented by other relevant policies that make up the country’s legal and institutional framework for PPPs.
- Is PPP critical for development? Why?
PPP is critical input to growth and development being a funding resource for selected infrastructure and development projects and a mechanism to free up government’s fiscal space for other development requirements. At the same time, it harnesses private sector efficiencies and innovation in the critical aspects of project design construction, operations, maintenance and actual service delivery.
The Duterte administration’s 10-point economic agenda looks at PPPs playing a critical role in its infrastructure spending and development targets. It will reinforce and augment the government’s resources and development options such as Official Development Assistance and internal government budget.
- What are the essential elements and ingredients for success?
The success of PPPs is anchored on the Implementing Agency’s (IA) commitment to pursue projects such as PPPs. Such commitment should be enabled by the IA’s solid institutional competencies and capability to plan out, prioritize, develop and structure a PPP project; secure mandated approvals and pursue a transparent and competitive selection process toward choosing the best private partner. Focused PPP project implementation monitoring is another key success factor. Continued PPP policy and process improvements are also critical to a successful PPP Program.
- What is the role of the PPP Center?
As the mandated agency to facilitate and coordinate the PPP Program, its provision of capacity building and technical support to implementing agencies in all aspects of project development and procurement, policy and processes, as well as implementation monitoring, have been regarded as critical inputs to a successful PPP program. The PPP Center’s Project Development and Monitoring, Facility has specifically been instrumental in affording implementing agencies the needed due diligence in PPP project development and structuring, as well as transaction advisory guidance during procurement stages.
- What are the obstacles and risks in PPP? What will make PPPs not viable? What should be avoided?
Like any other infrastructure or development undertaking, PPPs have inherent viability considerations and risks best defined and carefully structured at project development stages. The build-operate-transfer law and its implementing rules and regulations, the PPP policy issuances and PPPC’s technical support interventions have established mechanisms through which implementing agencies are enabled, and their PPP projects afforded the needed due diligence at project decision stages where said risks and considerations are crucial.
Watch out for more conversations in the future. Let me know who you want to hear from.
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