Business in Ghana

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World Bank support for development of Public Private Partnerships (PPP) in Ghana

Posted by Business in Ghana on November 17, 2013

The Ghana IDA Public Private Partnership (PPP) Project for $30 million became effective in December 2012. The World Bank_s counterpart for this project is the Public Investment Division within the Ministry of Finance and Economic Planning (MoFEP). The project comprises of three components: Component One: Institutional, Fiduciary, Legislative, and Financing Capacity Building – focuses on developing in-house capacity within the Government of Ghana to identify, assess, develop, implement and manage PPP transactions. Furthermore, the component provides Legislative, Regulatory, Policy and Guidelines Development Technical Assistance; provides resources for the development of a Framework for Managing PPP Fiscal Commitments; and finally, supports a framework for a Long Term Financing for Infrastructure. Component Two: PPP Pipeline Preparation and Transaction AdvisorySupport _ focuses on supporting the Government of Ghana to develop a commercially viable PPP pipeline of competitively-bid PPP projects to financial close. Component Three: Project Management and Monitoring &Evaluation _ focuses on financing specialized consultant services to assist MoFEP in project implementation.

The World Bank_s role in this project is to assist the Government of Ghana in the procurement of appropriate Transaction Advisory services in a transparent and competitive manner. The Transaction Advisors are expected to follow a two phase approach, as outlined in The National Policy on PPPs, where Phase (1) assesses the viability of projects as PPPs through undertaking a pre-feasibility study. If a project is deemed viable, Phase (2) progresses to a Full Feasibility study which entails undertaking a thorough due diligence of the transaction and preparing it to commercial and financial close. If the pre-feasibility study concludes that a project is not viable as a PPP, the Transaction Advisory services are terminated at that stage.

Currently, the IDA project supports the assessment of a number of potential PPP projects through the hiring of Transaction Advisory services, namely: Accra-Takoradi Highway Rehabilitation & Dualization; Takoradi Port Rehabilitation & Expansion; Asutsuare Bulk Water Treatment Plant; National Sports College Facilities; Accra-Tema Motorway Rehabilitation and Expansion; Eastern Rail and Inland Port Expansion; a National Flag Carrier Airline; and Security Exchange Commission New Building & Facilities. Most projects are at very early stages of procuring Transaction Advisors.

In terms of the National Airline transaction, the Government of Ghana is interested in investigating the procurement of a private party to develop and operate a national flag carrier. The details, viability and nature of this PPP are as yet unknown. The World Bank funded project, through the Public Investment Division, is supporting the Ministry of Transport (MoT) to hire a Transaction Advisor to undertake the two phase approach mentioned above. A summary of the project_s progress thus far includes the following: A No Objection was given by IDA on the Terms of Reference for the hiring of a Transaction Advisor on July 29, 2013; the Government of Ghana then issued a Request for Expression of Interest for the hiring of a Transaction Advisor, and MoT received 13 Expression of Interests. Following this, MoT submitted an evaluation report of the short listed firms to the Public Investment Division, and the evaluation report was submitted to the World Bank for No Objection on November 11, 2013. When/If the No Objection is cleared, the Government of Ghana will progress to the second stage of hiring the Transaction Advisor, which is the Request for Proposals.

It is important to highlight that the World Bank does not promote any particular PPP project proposed by the Government of Ghana. Rather, the Bank is supporting to build the capacity of government to assess the viability of projects that they are interested in pursuing following the PPP route. Ultimately, the IDA project will support the Government of Ghana to bring viable projects to market in a transparent way, which meets international standards.

For  more information on PPP Project visit Here

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