The Bahamas needs new and innovative ideas
From Bahama Islands info
NASSAU, The Bahamas — Prime Minister the Rt. Hon. Perry G. Christie said in the wake of the seismic economic and financial crisis that has gripped the world economy over the last several years, the country is confronted with daunting economic and social challenges that calls for new and innovative ideas and ways of doing things.
The Prime Minister was speaking at the Conference on Public Private Partnerships in Infrastructure Development and Financing at Atlantis, Thursday, June 20, 2013.
“While the Government must necessarily play a pivotal role going forward, I do believe that there is a critical need for involvement of the private sector in the further development of our economy and society which, in many respects, can be characterised as a social responsibility.
“The presentations and discussions at this conference will, I trust, make a valuable contribution to the debate on the way forward.”
Prime Minister Christie told the participants that he wished to contribute to the conference proceedings by outlining the Government’s views on the role to be played by private public partnerships (PPPs) in the country’s future development, as well as the Government’s vision of the way forward in this area.
He said as can be seen in practice around the world, PPPs can be extremely complex and they do vary widely in structure and mode of operation.
The Prime Minister at their very basic they simply constitute a contractual agreement under which the private sector both provides a public service or manages public sector assets that would otherwise be provided or managed by the public sector; and assumes substantial risks in the process, be they financial, technical or operational.
“The main reason that Government would contemplate such arrangements is that they offer the possibility of an improvement in value-for-money for the Government.
“This is achieved through the transfer of risks to the private sector where it is best placed to assess and handle those risks.”
He said the improved value-for-money is also secured by the fact that, where it is private sector capital that is employed and at risk, the economically efficient planning and operational decisions are made.
“That, in turn, should lead to both better quality services and lower cost services.”
Prime Minister Christie said Governments have also turned increasingly to PPPs as a means of maintaining much-needed levels of public infrastructure investment in the face of challenging deficit and debt conditions. He explained that through the implementation of PPPs, the financing needs of projects appear on private sector balance sheets rather than those of the Government. “I must stress that such a consideration should not be the main driver for the initiation of any PPP project, which, I believe, must first and foremost be driven by an efficiency objective. “To pursue PPPs merely for the fiscal benefits may prove illusory and lead to unsatisfactory results for both Government and the public.” He said in the case of The Bahamas, the archipelagic nature of the country represents another important motivation for PPPs. He explained that as the nation spreads across some 100,000 square miles, it is difficult to replicate and continuously improve public infrastructure as often as necessary. “As we strive to enhance development prospects in the Family Islands, there will be a clear need for enhanced public infrastructure.” The Prime Minister said, “An avenue will therefore exist for exploring the feasibility and desirability of PPP arrangements with developers and other private sector interests to ensure that the appropriate supporting infrastructure is constructed and managed for the benefit of all stakeholders, including local residents.”
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Private Public Partnerships pose certain challenges that must be addressed
From Bahama Islands info
NASSAU, The Bahamas — While there is no doubt that properly-designed and implemented Private Public Partnerships (PPPs) can offer significant benefits, they do pose certain challenges that must be adequately addressed if the schemes are to be successful, Prime Minister the Rt. Hon. Perry G. Christie said.
“Foremost among these challenges may be the structuring of effective mechanisms to ensure that the major risks of a PPP are identified and quantified, and that the appropriate risk-sharing is set out for both the Government and the private sector partner.”
The Prime Minister was speaking at the Conference on Public Private Partnerships in Infrastructure Development and Financing at Atlantis, Thursday, June 20, 2013.
He said also critical is proper planning and design of PPPs to ensure that value-for-money is secured.
The Prime Minister said, “As well, it is vitally important to implement effective, ongoing monitoring of any PPP to ensure that the intended results and benefits are achieved.
“Finally, I firmly believe that potential social resistance highlights the need for political and social will, particularly in areas that may be politically sensitive, such as water distribution and electricity generation; as such, we must find the means to increase co-ordination and consultation with stakeholders, especially in relation to the potential social and environmental impacts of projects and related infrastructure.”
He said in that vein, consultation must be buttressed and informed by effective environmental and social impact studies.
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