1. Principles for public-private partnerships – towards sustainability?
Lessons from SAGCOT, healthcare in Lesotho, and Better Factories Cambodia
ecdpm.org/dp194
Sebastian Grosse-Puppendahl
Trade, Investment and Finance Programme
06 February 2018

2. 1. Context
Growing recognition that challenges are multi-faceted & complex, requiring collaborative, multi-stakeholder alliances between all sectors of society → public-private partnerships
Need for smart use of aid & public funding
Increasing focus on leveraging private finance and investments
→ e.g. EU External Investment Plan, OECD Blended Finance principles
majority of bi-/multilateral donors have PSE programmes 4 SDGs
→ economic growth, job creation & market development key factors in most donors’ support to developing countries
→ PSE/economic growth focus reflected in institutional set-up
criteria / principles to ensure more ‘developmental’ private sector engagement (PSE)
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3. 2. Public-Private partnerships (PPPs)
PPPs implemented through wide range of departments (i.e. development, trade, DFIs etc.) & diverse definitions, categories
‘Successful’ partnership → beyond private returns (financial viability), public returns key to ensure social, political & environmental sustainability
Challenge: balancing dual objectives!!
Country bias: commercial interest → developed/stable markets
BUT developmental needs more in poor/fragile countries
e.g. 60% of PPP investments targeted to UMICs
However, more development principles/sustainability criteria in place governing PSE programmes (e.g. CAFOD et al. work)
→ reflects degree of convergence on appropriate PS behaviour
→ challenges remain! compliance & enforcement
To ensure compliance, donors must strike the right balance between legally binding regulations & softer measures
→ business incentives for voluntary principles vs. effectiveness
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4. 3. Case study on agriculture: Southern Agricultural Growth Corridor of Tanzania (SAGCOT)
Interesting case: massive scale in terms of finance and geographical area
→ important lessons for other PPP frameworks / future PPPs
WEF flagship, mainly business-driven partnership, determining / influencing power dynamics among different stakeholders
Regional in nature → geographical area
Holistic approach, SAGCOT tries to address various gaps/issues, such as:
engaging local farmers,
raising overall agricultural productivity, thus contributing to broader economic transformation and decreasing (rural) poverty,
increasing job creation, and
improving regional coordination towards food security/market dev
ensuring environmental sustainability
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5. 3.1 Case study on agriculture: SAGCOT
SAGCOT objectives and principles to achieve fair & inclusive Agricultural Green Growth
However:
Translation of policy (e.g. Greenprint) to practice?
Different actors, different language (e.g. incl, sust invest)
→ reports: environmental/social objectives controversial or at risk
→ Need for closer monitoring/independent assessment & review
Sustainable development principles → no mention of financial sustainability & demand for such investments
Conflicting interests
→ national/local elites & overall business environment constraints as negative factors for PPP to develop
→ Land conflicts, land management, land use: direct (negative) impact on PPP rather than positive one on FDI
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6. 4. Conclusion ecdpm.org/dp194
Two concerns raised most frequently regarding development PPPs:
→ additionality & transparency
defining, ensuring, measuring additional impact due to public finance
availability of reliable information on the negotiation, the design, the implementation and the results of PPPs
Analysis reflects wide & widening definition of PPPs + lack of data!! → 2 basic questions for evaluating PPPs’ success & sustainability
Is the PPP the best tool to address the identified needs in a specific context, in comparison to the alternative options?
Does the PPP deliver what it promised to deliver?
Need to better understand the distribution of costs and benefits
→ greater transparency required based on available data
→ underlying PPP design to reflect likely power imbalances between powerful MNEs, smallholders & public sector in weak environments
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7. Thank you! sgp@ecdpm.org | @SebGroPup ecdpm.org/dp194 www.ecdpm.org
European Centre for Development Policy Management