Photo: Scaling Solar project in Zambia
What is a common thread between Argentina, Maldives, and Zambia? In each of these countries, the World Bank provided guarantees to support transparent auctions for renewable energy. Through these, I have seen how the Bank’s involvement helped increase private investors’ confidence, attract world-class developers, and ultimately reduce tariffs.
Drawing on 10 years of diverse experience in the power sector in both public and private organizations, my role is to help bridge the divide between public and private parties and help each side better understand the other. The World Bank is ideally positioned for this. Both sides understand the World Bank carries out a detailed due diligence and ensures the auction meets international standards. Both sides appreciate the World Bank will be an honest broker if issues arise. Because of its long term and continuous involvement in our client countries, the World Bank can help identify and solve issues early on. As such, no World Bank project-based guarantee has ever been called.
A major factor hindering infrastructure implementation and delivery is the absence of good governance, according to the 130 delegates from 27 countries who came together for the first Regional Roundtable on Infrastructure Governance in Cape Town in November.
There’s no denying infrastructure is crucial to Africa’s growth prospects. Nor can one ignore the ever-growing need for infrastructure on the continent—in Sub-Saharan Africa, only 35% of the population has access to electricity, and 23% still lack access to safe water and sanitation. Despite an estimated shortfall of nearly $100 billion in infrastructure investment in Africa, lack of financing is not the biggest problem.
The landmark Roundtable brought together representatives from African governments, the global private sector, multilateral and international organizations, civil society organizations and other development partners, for a discussion on the challenges and practical solutions to the governance impeding successful infrastructure delivery in Africa.
Photo: DFID | Flickr Creative Commons
Health is one of the United Nation’s Sustainable Development Goals (SDGs). However, it is not feasible for any country, rich or poor, to provide its entire population with all needed health services. Accordingly, the private sector has an important role to play in closing the healthcare gap, as it contributes financial resources, innovation, and expertise.
The managed equipment services (MES) arrangement, used in Kenya, is one way to do this. MES is a business model emerging in Kenya’s healthcare system involving partnerships between the private sector and public healthcare providers that offers solutions to some of the challenges posed by the dynamic healthcare industry.
Photo: Debbie Hildreth Pisarcik | Flickr Creative Commons
Several years ago, after almost two decades at various investment banks, I joined the World Bank’s Financial Solutions team. I had always thought of the World Bank as the leading concessional lender to governments, the financial muscle behind large infrastructure projects, and the coveted supranational client of investment banks. I have since discovered the power of World Bank guarantees and how they can help borrowers maximize their World Bank country envelopes. Since joining, I have helped various clients raise over $2 billion in commercial finance. And all this with a fraction of World Bank exposure.
Robert Osudi is an economist at the Public Debt Management Office of the National Treasury of Kenya. In addition to working on debt policy, strategy, and risk management, his work in Kenya’s debt office focuses on analyzing fiscal risks, fiscal commitments, and contingent liabilities of Public-Private Partnership (PPP) pipeline projects. Robert is halfway through a four-month special assignment working with the Infrastructure, PPPs & Guarantees (IPG) Group at the World Bank Group as a PPP fiscal risk analyst under the auspices of the Global Secondment Program.
The secondment program offers an opportunity for selected officials of a member country, regional agency, development bank, international organization, academia, or private enterprise, to be appointed to the Bank for a specific period to enhance their skills, share knowledge, build strategic alliances, promote cultural exchange and diversification to contribute to the Bank’s work. Secondees are funded by the releasing organization.
We sat down with Robert to understand what he is learning during his on-the-job training in Washington and how he can apply that knowledge upon his return to Kenya.
It’s not always easy to convince the private sector to participate in public infrastructure projects—especially in developing countries and emerging economies. Why is this a problem? Because there simply is not enough public money to meet the growing demand for infrastructure, which is a key element of development and poverty alleviation. The need is great, numbering in the trillions of dollars.
But there is good news—the market has both the trillions and the expertise to use it, if the conditions are right. And the World Bank Group has a number of instruments that can help create an environment that meets the needs of the private sector in financially, environmentally, and socially sustainable ways. Guarantees are one of those instruments, a tool that is highly effective in leveraging limited resources for mobilizing commercial financing for critical infrastructure projects.
Photo: Diana Susselman | Flickr Creative Commons
I worked with the International Finance Corporation (IFC) for exactly 20 years, all of which was in advisory work. I spent five years in Barbados, five in Washington, five in Zimbabwe and five in South Africa: perfect symmetry. On my 20th anniversary, I took a package and returned home, to the beautiful Caribbean. IFC was a great place to work, where we were challenged every day to come up with innovative solutions to seemingly intractable problems. Some of our deals were truly groundbreaking and lived up to IFC’s motto to improve people’s lives. That’s the kind of job satisfaction that money can’t buy.
After 76 countries, millions of air miles, and some pretty forgettable airport hotels, sometimes I look back and think: what was it all about?
Photo: Gustave Deghilage | Flickr Creative Commons
Does experience in implementing Public-Private Partnerships (PPPs) reduce a country's chances of contract failure?
In a recent study entitled Do Countries Learn from Experience in Infrastructure PPPs, we set out to empirically test whether general PPP experience impacts the success of projects—in this case, captured by a project's ability to forego the most extreme forms of failure that lead to cancellation.
Photo: Pressmaster / Shutterstock.com
In the aftermath of the global financial crisis, policy makers focused on improving access to finance, missing the crux of the problem: governance.
In pursuit of achieving the Sustainable Development Goals through the 2015 Addis Ababa Action Agenda on financing for development, the Regional Roundtables on Infrastructure Governance* were created to promote a community of practice comprising government officials and the international development community to strengthen capacities within developing countries and establish good practices in infrastructure governance across various government sectors.
The inaugural roundtable, hosted by the Development Bank of Southern Africa, will take place in Cape Town on November 2-3, 2017, and aims to emphasize that for the commercial financing of infrastructure to be a viable option, governance reforms must happen.
Photo: Cristiano Zingale | Flickr Creative Commons
"The nation has a huge infrastructure deficit for which we require foreign capital and expertise to supplement whatever resources we can marshal at home. In essence, increased engagement with the outside world is called for as we seek public-private partnerships in our quest for enhanced capital and expertise. This is the way of the new world for all countries in the 21st century." – HE President Muhammadu Buhari
Within the first 100 days of his administration, President Muhammadu Buhari signaled his administration’s commitment to attracting the private capital and expertise needed to address Nigeria’s infrastructure deficit. This led to a renewed engagement between the World Bank Group and Nigeria to enhance the attractiveness of the Public-Private Partnership (PPP) ecosystem in the country.