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Private Sector Development

Guarantees light the way for clean energy through renewable auctions

Arnaud Braud's picture


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.

Colombia: the roads more traveled

Philippe Neves's picture


Photo: Dominic Chavez / International Finance Corporation

In the early 1990s, Colombia’s road infrastructure was a maze of poorly maintained roads and bad highways. Difficult geography—the Pacific coast jungle and the Andes branching out into three chains—made it harder to improve road conditions and connect isolated communities. Conflict, corruption, and short-term political priorities contributed to the problems plaguing Colombia’s road system. But just as influential were the problems with the nation’s existing concession contracts that had wrong incentives, created opportunities for renegotiating signed contracts, and assigned unproportioned demand risk to the Government of Colombia.

A critical piece of the infrastructure puzzle: good governance

Chris Heathcote's picture



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.

How Managed Equipment Services in Kenya help the private sector contribute to healthcare

Cynthia Olotch's picture


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.
 

Building benchmarks for infrastructure investors: a long but worthwhile journey

Sarah Tame's picture


Photo: User 377053 | Pixabay

The Argentinian presidency of the G20 opens this month and will be marked by a focus on infrastructure investment. The G20 and Organisation for Economic Co-operation and Development (OECD) have already announced a widescale data collection initiative to create benchmarks to monitor the risk-adjusted financial performance of private infrastructure debt and equity investments.

It’s about time.

Investors have hit a roadblock when investing in infrastructure. Until now, none of the metrics needed by investors were documented in a robust manner, if at all, for privately held infrastructure equity or debt. This has left investors frustrated and wary. In a 2016 survey of major asset owners by the EDHEC Infrastructure Institute (EDHECinfra) and the Global Infrastructure Hub, more than half declared they did not trust the valuations reported by infrastructure asset managers. How, under such conditions, can the vast increases in long-term investment in infrastructure by institutional players envisaged by the G20 take place?

Year-in-Review: 12 top blogs of 2017

Yelena Osipova-Stocker's picture

2017 was a busy year in the world of infrastructure and public-private partnerships at the World Bank Group: from new knowledge products and tools, to innovations and success stories in places ranging from Peru and Ukraine, to Jordan, Pakistan, and Fiji. As we look at our top content that resonated most with you, our blog readers, we can categorize these posts into three broad categories:

Maximizing concessional resources with guarantees—a perspective on sovereigns and sub-nationals

Sebnem Erol Madan's picture


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.

Farewell 2017; Hello to More and Better Infrastructure in 2018

Jordan Z. Schwartz's picture


Photo: auphoto / Shutterstock.com

As Washington, D.C.’s infrastructure braces for its first winter freeze and 2017 draws to a close, this feels like the right moment for a recap on what the year has brought us in terms of closing the infrastructure gap across emerging markets and developing economies; policy directions within and outside of the World Bank Group; new instruments, tools, and resources; and—the proof in the pudding—actual investment levels.

There may not be one blog that can capture all of those themes in detail, but here is a brief overview of what 2017 has meant and what is on the docket for 2018 and beyond.

From the Kenyan Debt Office to Washington: Sharpening skills in PPP fiscal risk management

Robert Osudi's picture



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.

Waste not, want not: PPPs lead to better waste management in Greece

Nikos Mantzoufas's picture


Photo: European Commission 

Greece has had a very poor track record in reducing the amount of waste going into landfills. One of the main reasons for this, other than the NIMBY (not-in-my-backyard) opposition to creating waste management facilities, was that for decades choosing the right technology was the apple of discord, causing disagreement and delaying advancement towards integrated waste management. In the last few years, however, three Public-Private Partnership (PPP) waste management projects have been initiated in Greece.

This past July, within two years of signing the PPP contract in 2015, the first project was inaugurated in Western Macedonia—without a day’s delay, any contract change, or cost overrun. The system will cut the amount of waste going to landfill, reuse material for commercially-viable products, boost the region’s growth prospects through job creation, and raise public awareness to prevent waste.

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