1. Public Private Partnerships (PPP)
Kalat Al-Bulooshi
CEO
Oman Investment Corporation SAOC

2. PPP Definition
"a long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and remuneration is linked to performance“ “world bank definition”

3. PPPs: What is the Rationale
Public
Policy Leadership
Setting national policy agenda
Setting policy agenda for the sector
Enabler
Creating investor friendly environment
Facilitating the operations of PPP
Provider of Public Welfare
Regulating and Monitoring to ensure that public is benefitting from the partnership
Contributor to PPP
Providing resources
Sharing risk
Educator / learner
Private
Contributor to Society
As a partner deliver public services and goods
Contributor to PPP
Providing resources
Sharing risk
Innovations and new solutions
New organisation culture
Educator / learner
Management and Accountability
Efficient use of resources
Citizen / customer satisfaction
Public and Private: Both achieve their goals

4. 2014-15 317 PPP deals worth USD142bn Global Infra Deals, 2015
InfraDeals 2015 Trend Report

5. Benefits of PPPs
More Funds: Bridges large funding gaps in physical and social infrastructure
Improving Project Management Skills: Enhances project planning and implementation skills
Lowering Cost: Leads to cost savings over the life of the agreement
Reduces Time Overruns: Time bound agreements and government monitoring improves project implementation
Improves Doing Business Environment: Government adopts new institutional and legal frameworks
Creates Investor Friendly Environment: Government adopts new regulations and reforms financial markets
Competitiveness: Government can select competing bidders as partners for various projects
Partnership Advantage: The capabilities of Government and Private organisations come together to provide efficient services to society
Diversification of Economy: Government can use funds to take up challenging projects
Private Sector Growth: More investment; more jobs; more tax contributions; regional development

6. Why PPPs for Oman
Enhancing cooperation between public and private sector
Economic diversification
Using private sector funds and capitals to achieve government plans
Job creation
Country developments and implementation of plans

7. Typical characteristics of a PPP
Long term contracts
Private sector assumes delivery risk
Optimum risk allocation
Payments are output based
Better service and cost outcomes
Improved budget certainty

8. Oman Government financial outlay under traditional procurement vs a PPP

9. Comparative Performance of PPPs II
Sources:
(1) UK National Audit Report on PPPs
(2) Allen Consulting group, Univ. of Melbourne,

10. Typical PPP contract structure

11. Risk allocation holds the key to PPP procurement

12. Risk transfer under procurement methods

13. PPP project development lifecycle

14. List of projects – Initial assessment
PPP able projects
Many precedents
Potentially PPP able projects
Commercial structuring is a key enabler
Challenging PPP projects
Few / no precedents
Power & water
Roads/Highways
Bridges/tunnels
Ports/Airports
Healthcare
Education
Street lightening
Sewage/wastewater treatment
Solid waste management
District Cooling
Universities
Museums/Leisure theme parks
Social housing
Industrial zones
Logistics/warehouse zones
Rail
Economic cities
Medical cities
Fishing/fruits/vegetables markets
National parks
Water network
Reurbanisation housing
Food security
Fisheries
Oilfield services
Limestone factories
Cement factories
Petrochemical services
Urbanization/real estate
Rail rolling stock factories
Hotel and resorts
Banking
Tourism services

15. Fundamentals for A Successful PPP

16. Why is the legal and regulatory framework vital to a successful PPP framework?

17. Do We Have A Successful Track Record in PPP
The Privatisation of the Power and Water Generation in Oman Power and Water Procurement Company SAOC have been VERY SUCCESSFUL and have been role model for others.
Key Success Factors for Privatised Power and Water Sector are;
Right Policy and Regulations (Power Sector Law issued by RD)
Independent Regulator (AER)
Open, Transparent and Competitive Award Process
Right Risk Allocation
Competent and skilled procurement body (OPWP)

18. Thank you