Government To Execute Five Projects - Through Public-Private Partnerships
7/24/2012 3:30:28 PM -
The government has identified five ambitious projects as initial infrastructural deliveries under the public-private partnership policy framework.
The projects, which could each cost not less than $300 million, include the building of a radiology and imaging services centre at the Korle Bu Teaching Hospital; rehabilitation and expansion of the Takoradi and Tema ports and the dualisation of the Accra-Takoradi road.
Also among the five turn-key projects, which are expected to commence in the first half of next year, are the construction and expansion of the Kotoka International Airport in Accra as well as the upgrading of the Kumasi, Tamale and Takoradi airports.
The Director of the Public Investment Division of the Ministry of Finance and Economic Planning, Mrs Magdalene Appenteng, explained to journalists in Accra that the PPP policy had created the Infrastructure Finance Facility which would have to be capitalised from various sources to help match funds that would flow in from the private sector.
Initially, the fund would be made up of about US$80 million to US$100 million equivalence in the local currency with funds coming in from development partners, government sources and bond issues.
The workshop was organised for financial and economic journalists to help explain the concept of PPPs and how far the government had led the process.
“We are looking at a mixed bag of financing options but we prefer long term funds that would be appropriately priced and easily accessible,” Mrs Appenteng explained.
The PID director said the Public-Private Partnership law, which was at the draft stage, would be passed by Parliament by the close of the year to give more confidence to the investor community.
Explaining how the PPPs was a clear departure from privatisation, she said the concept was a contractual arrangement between a public entity and a private sector party with clear agreements on objectives which are shared between the parties towards the provision of public infrastructure and services hitherto provided by the public sector.
This means that the private sector participant would receive benefits or financial remuneration usually derived from tariffs or user fees, government budgets, periodic payments or a combination of all.
She mentioned the accelerated delivery of needed infrastructure and services on time and within budget as some of the benefits that PPPs brought on board.
Mr Paul Victor Obeng, who has been selected as the PPP Champion, said the policy space was important to attract private capital to develop infrastructure and transform the economy into the upper echelons of middle income status.
He said it was one of the surest ways of leveraging the efficiency and dynamism of the private sector to support government development targets.
Mr Obeng said for Ghana to be part of the global production system, it had to bring its infrastructure up to speed so as to enable its enterprises to be competitive in the global market place.
“The capacity to dream doesn’t reside with the government alone, but also with the people who are at the receiving end of the unavailability of services and infrastructure,” the PPP champion stressed, adding that using private funds to deliver public infrastructure had helped to avoid all the cumbersome processes embedded in the public sector.
He said in the past using the PPPs had been unorganised but what the government had succeeded in doing was to bring it within a policy space to give confidence and assurance to the private sector of the security of their investments.