Public/Private Partnerships projects…Govt. to discuss financing model publicly

May 30, 2014 News

---

Minister of Finance, Dr. Ashni Singh, has issued a call for the financing institutions of the region to scale-up their efforts in assisting Caribbean states to promote Public Private Partnership (PPP) projects.
The model of financing, which has been objected to by Opposition Parliamentarians, is to be used in a number of large scale projects, including a new Demerara River Bridge, dredging the Demerara Harbour, a deep water port, a road to Brazil and development of an Upper Mazaruni Hydro-power project.
Already, projects like the Berbice River Bridge, the Marriott Hotel and the soon to be executed Amalia Falls Hydro Power Project have been negotiated under a PPP financing model, according to a Government statement yesterday.
However, the Opposition and observers alike have blasted Government over the transactions which literally placed the projects in the control of private investors, although the majority of monies came from taxpayers. In the last three cases, the state is almost sidelined in receiving returns on its investments.
Minister Singh, in making an observation at the Caribbean Development Bank (CDB)’s seminar on ‘Public Private Partnership in the Caribbean: Building on Early lessons’, on Wednesday at the Guyana International Conference Centre, noted that PPPs remain an extremely important instrument for use in financing the huge infrastructure gap in the region.
The Finance Minister said that the dilemma for the region, however, remains taking full advantage of these PPPs. He said that in each of the respective countries, largely because of scale, the issue remains fairly limited institutional capacity to implement large PPPs, and the regional and international financing institutions, therefore have an important role to play in that respect.
“The challenge for us as a region lies in identifying good opportunities for PPPs, structuring good transactions, bringing credible investors to those transactions and bringing those transactions to concrete conclusion,” he stated.
”Regional and international institutions have an important role to play in helping us to identify good opportunities for PPPs and in helping us to conclude those transactions…I would like to call on these institutions to scale up their efforts with respect to helping us facilitate good PPP transactions.”
The seminar, which formed part of the Bank’s calendar for its 44th Annual Meeting of its Board of Governors in Guyana, and towards seeking to find solutions to issues of economic growth in the Caribbean, examined one of the possible solutions to this problem.
This includes how to encourage greater private sector involvement in the provision of public growth.
In addition to providing the findings of a recently completed CDB study in this regard, a panel of five experts on the issue, and subsequently, those in attendance were given the opportunity to offer their opinions, observations or ask questions.
The Bank’s Director, Economic Department, Dr. Justine Ram chaired  the panel discourse, which  included Economist, CDB, Carl Howell, Manager, Latin America and the Caribbean International Finance Corporation, World Bank Group, Washington,  Richard Cabello, Sector Specialist, Sovereign and Infrastructure, CIBC First Caribbean Investment Bank, Grand Cayman, Gemel Sober, Managing Director, National Roads, Operating Construction Limited, Jamaica Ivan Anderson and Managing Director, National Industrial and Commercial Investments Ltd, Winston Brassington.
Anderson and Brassington both presented case studies; Anderson on the Jamaica Highway 2002 project and Brassington on three PPP projects in Guyana, the Berbice River Bridge, the Marriott Hotel and the soon to be executed Amalia Falls Hydro Power Project.
Brassington, noting that Guyana has had 10 years’ experience with PPPs, said that the major challenge remains finding political consensus on these projects.  ”Political consensus has been difficult,” he said.
He noted that Guyana, like other countries is seeking to, in the future, implement PPPs in a formal structure, and is therefore moving to have a white paper on PPPs. He said too, that going forward, Government’s major thrust on PPPs will be on infrastructure with focus on reducing logistical cost, efficiencies and opening up new frontiers.
Meanwhile, Carl Howell gave a major overview of the bank’s study and PPPs in the Caribbean, whilst Richard Cabello presented the perspective from IFC on PPPs – lessons for the Caribbean.  Gemel Sobers’ presentation was on structuring finance for Caribbean growth.
Howell noted the role that CDB would play with regards to PPPs in the Caribbean and identified by the CDB report, capacity building in countries would be the bank’s agenda.

---

---