Representatives of the African Development Bank (ADB), governments, development finance institutions, the private sector and professional associations joined a recent workshop to discuss how ADB can strengthen support for public private partnerships (PPP) and channel greater investment towards economic and social infrastructure. The event, titled ‘Designing the African Development Bank’s PPP Framework’, was hosted virtually by ADB.

The workshop took place against the backdrop of the Covid-19 pandemic and the ensuing economic slowdown, which has sharpened an already urgent need for investment. Five African countries (South Africa, Morocco, Nigeria, Egypt and Ghana) accounted for more than fifty percent of all successful PPP activities from 2008 to 2018. Several other countries have multiple PPPs in the pipeline; Burkina Faso has twenty and Botswana eight.

“Before the Covid-19 pandemic, African infrastructure was already struggling to structure projects tailored for the private sector and at the same time achieving value for money for the public sector including affordability for users. It is therefore imperative that hybrid solutions such as PPPs must be seen and promoted as a way of building  better , stronger and  greener infrastructure  by clawing back private capital to infrastructure while creating much needed fiscal room for governments to address  other demands including building health systems’ resilience,” ADB  Vice President,  Solomon Quaynor said in his opening remarks.

ADB estimates Africa’s infrastructure financing needs will be up to $170 billion a year by 2025, with an estimated financing gap of up to of $68 to $108 billion a year. PPPs are seen as a key element in narrowing this gap by crowding in private sector investment in infrastructure.  ADB is playing a critical role in scaling up that effort.

Amadou Oumarou, ADB’s director for infrastructure and urban development department presented several rationales for the bank’s effort to develop a PPP framework, including its ten-year strategy (2013-2022) and a recommendation from the bank’s independent evaluation unit to scale up PPP interventions.

Webinar participants expressed a desire for the bank to play an expanded role in supporting PPP development in Africa by strengthening policy and regulatory frameworks, building government capacity,  project structuring and advisory services as well as  the provision of financing instruments such de-risking, guarantees, credit enhancements and local currency financing. 

“Countries need to learn from each other’s achievements and mistakes, they need to have standard documents and checklists that will guide their institutions through the PPP lifecycle,” said Shoubhik Ganguly of Rebel Group International, which is partnering with the ADB to develop the framework.   Mike Salawou, division manager, infrastructure partnerships said:  “Policy dialogue is something the bank places a lot of premium on, and that has proven to be very efficient in informing decision making.” 

Private sector representatives praised development finance institutions (DFIs) as indispensable in securing financing for PPP projects in Africa.  One example of a successful PPP project cited during the workshop is the Kigali Bulk Water project, which received significant backing from the African Development Bank, the World Bank, as well as private sector players.

According to Phillipe Valahu, CEO, PIDG the Kigali Water project is a perfect example of having an integrated support to a PPP project by using the three pillars proposed in the bank’s PPP Framework. The project benefited from debt funding from PIDG alongside ADB which each provided $19 million of senior debt on commercial terms.   “The African Development Bank has unparalleled trust relationships with African governments, and we need to take advantage of that to speed up implementation of PPPS,” Quaynor said in closing.



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