LAST week, I wrote an article on the issue of public-private partnerships (PPPs or P3s), and promised a follow-up, something I have completed in this week’s article.

To recap, the basic model of what constitutes a public-private partnership is, to quote the EU, “a contractual agreement between the public and the private sectors, whereby the private operator commits to provide public services that have traditionally been supplied or financed by public institutions. The ultimate goal of PPPs is to obtain more ‘value for money’ than traditional public procurement options would deliver.”
In the third installation of this series, I am going to take a look at how liberally we can interpret terms like ‘public services’ — as a means of opening up the basic concept of PPPs  — but for now, we need to look at the foundation of any good public-private venture, the policy environment.
Looking at the research I’ve done over the past week or so on the issue of P3s, I’ve discovered that Asian countries in particular seem to have gone the furthest in the developing world in instituting workable P3 programmes, although – as we might expect – it is the developed world, the UK being the foremost example, which has made public-private partnerships into a high science.
P3s are increasingly recognised as crucial to development. As a Japanese ministry report, cited below, states: “Carrying out infrastructure construction projects efficiently using PPP can also be evaluated from the perspective of contribution to poverty reduction. In the joint study report (conducted by a Japanese ministry), ‘inclusive development’ means that poverty reduction and infrastructure construction are regarded as a pair of wheels; infrastructure construction drives economic growth that leads to poverty reduction, while promoting the supply of public services such as electricity and transportation, which will contribute to improving people’s living standards.”
In terms of a policy statement for the Asian model of PPPs, this implies a clear mandate for development in which the PPP venture – infrastructure construction projects – is arguably as incidental as it is correlative to poverty reduction, something to take note of, since it bears on what I’m going to posit in next week’s article. On the point of regional policy, there has been some recent focus to put this in place at the level of the Caribbean Community. A few months ago, at the opening of CARICOM’s 19th Council on Human and Social Development (COHSOD) meeting right here in Guyana, Secretary-General, Edwin Carrington, directly linked the creation of a P3 policy framework to sustainable development in the Region:
“Policy coherence in human and social development no doubt makes it imperative for labour to be mainstreamed into the social and economic strategies of the Region. Among other things, this… means establishing a vision of the parameters of growth and development that are directly linked to the human resource requirements as a main prerequisite of development. But these cannot be achieved without a concerted effort to harness sustainable public-private partnerships, strengthen institutional capabilities and create the enabling environment for human resource development.”
The perennial problem, however, with regional initiatives such as this is that they often do not go beyond the specific donor-funded conference. True, this typical failure to launch often has an associated element of lack of funding; developing economies often do not have the capital to invest in the sort of trial-and-error conceptual development process that results in working practical programmes. That said; innovation often costs less than people make out.
And in this case, the groundwork has largely been done already, with supporting information easily available as it should be in this age of the Internet. The Seoul Declaration on Public-Private Partnerships in Asia was actually built upon extensive work undertaken by the United Nations, and enshrined in several declarations and other policy documents, beginning with the Millennium Declaration of September 2000.
What has happened is that this has in turn spawned numerous other studies, reports and policy documents on P3s in Asia, undertaken by multilateral agencies, government agencies and ministries, non-governmental organisations and – as one should expect considering the issue – private companies.
Within these documents is a wealth of useful information on P3s from a regional perspective, as well as national ones. For example, Japan’s Ministry of Economy, Trade and Industry issued a report on the Asian P3 Study Group (2004) which makes for useful reading from an investor’s point of view considering the increasing influence of Asia – Japan and China particularly – in the Region. The Asian Development Bank Institute (ADBI), has published a seminal discussion paper, “Infrastructure Challenges in South Asia: The Role of Public-Private Partnerships”, written by Geethanjali Nataraj which makes a sobering case of both the usefulness as well as limitations for P3s in Asia, usefully pointing out that while such partnerships will not replace state financing of large-scale projects, they free up state agencies to focus on their core mandates while still adapting to the changing infrastructural needs of the specific country. The international legal firm of Norton, with an office in Singapore, has its own publication on P3s in Asia inclusive of opportunities for investment as well as country-specific risk assessments.
In short, the resources to at least begin the establishment of a P3 policy framework, as touted by CARICOM’s Secretary-General, are already well within the public domain and accessible by anyone willing to dig. Therefore, the available information can certainly provide direction and serve as the basis for the regional embrace of the public-private partnership policy.

Next week, presupposing that we can build on the experience of the Asian experience in PPP policy formulation, I am going to take a look at how we can transform such policy into workable, practicable projects that are relevant to the development of the Region.
My sincere gratitude and thanks to all those persons who have been sending me emails and text messages about my articles, they’ve been very useful.
Written By Keith Burrowes