1.  PPP Department within the Ministry of Economy and Transport  Government Decree in May 2003 to set up an Interdepartmental Committee – Ministry of Economy and Transport – Ministry of Finance – Ministry of Justice – Prime Minister’s Office – Central Statistical Office Public Private Partnership Government actions to promote PPP www.gkm.hu www.itd.hu

2.  Long-term goal: 2500 km length of expressway network by 2015  Act CXXVIII on the development of the Hungarian expressway  network (accepted by the Parliament in December 2003)  Deficit constraints => need for alternative ways of financing − PPP projects − EU funds Road infrastructure development program Public Private Partnership www.gkm.hu www.itd.hu

3.  Approximately 170 km section between Budapest and the Hungarian - Serbian border  Original concession agreement signed in 1994 with French consortium AKA  First phase (110 km) handed over in 1999  New agreement reached in March 2004  Further 60 km section is expected to be built PPP motorways: M5 Public Private Partnership www.gkm.hu www.itd.hu

4.  Second phase to be built by AKA (estimated cost: EUR 836 million at December 2004 value)  The motorway became part of the national vignette system  DBFO (design-build-finance-operate) structure with risk sharing - construction and availability risks borne by AKA  Availability payment mechanism  Deductions in payments in case of poor performance and safety indices Amended structure of the M5 Public Private Partnership www.gkm.hu www.itd.hu

5.  Part of the V/c Helsinki corridor  Approx. 252 km section between Budapest and the Hungarian - Croatian border to be built in 2 phases: – first phase between Budapest and Dunaújváros (54 km) by 2006 – second phase between Dunaújváros and the Croatian border (198 km) by 2007 PPP motorways: M6 Public Private Partnership www.gkm.hu www.itd.hu

6.  Concession tender won by Bilfinger Berger BOT GmbH, Porr Infrastruktur GmbH, Swietelsky International Baugesellschaft mbH  Concession period: 22 years  Timing: − Concession Agreement signed on 2 October 2004 − Target interim completion date: March 2006  DBFO structure  EIB and EBRD considers providing financing to the concessionaire PPP motorways: first phase of the M6 Public Private Partnership www.gkm.hu www.itd.hu

7.  Payment mechanism: − national vignette system − availability payment to the concessionaire  Risk sharing: – International practice – State: discriminatory change in law, delivery of the Site, dangerous materials, etc.; – Concessionaire: design, construction, financing, availability, except relief events; – Shared (vis major) PPP motorways: financial structure of the M6 Public Private Partnership www.gkm.hu www.itd.hu

8.  Projects of the Ministry of Education  Goal: development of university infrastructure – Government decision on creating 10 000 accommodations in student hostels in the framework of PPP  The pilot project of the University of Debrecen − Classical DBFO structure − Decision of PPP Committee on supporting the project on 30th September 2003 − Approval of the Economic Cabinet and the Government − Public procurement procedure completed, construction is under way  11 further similar PPP schemes for other universities PPP student hostels Public Private Partnership www.gkm.hu www.itd.hu

9.  Goal: the development of prison service infrastructure - two new PPP prisons  DBFO construction – During a period of 15-20 years, 700 prisoner places / prison – „Operate” element: only those tasks are performed by the state which can not be carried out by the private sector (custodial services, on site medical facilities and registering of prisoners) – Positive decision of the PPP Committee: 10th October 2003  Tender announcement is expected at the beginning of 2005 Prison project of the Ministry of Justice Public Private Partnership www.gkm.hu www.itd.hu