By Josiah Dimbo in Harare.
Zimbabwe needs about 8-10 Billion dollars for infrastructure development, a cabinet minister said recently in Harare.
The Minister of Finance, Hon Tendai Biti said the amount required for infrastructure development is huge for the government to undertake big projects without assistance from the private sector.
“Zimbabwe is now stabilizing and we need to engage the private sector to undertake massive infrastructure development.
Public-Private-Partnerships relationships must be explored and harnessed for the benefit of the country” Biti said.
The Minister who was the guest of honor at the seminar jointly hosted by the Development Bank of Southern Africa and the Infrastructure Development Bank of Zimbabwe added that its high time serious engagement between public –private sector should be encouraged if Zimbabwe is to move forward and prosper.
Speaking at the same occasion, the chief Executive officer of IDBZ Mr.
Charles Chikaura noted that Africa has been lagging behind in terms of infrastructure development because of resource challenges that African Governments are currently facing.
“The solution to Africa’s quest for development is a win-win marriage between public and private sectors .Collaboration and active participation of the private sector in infrastructure development is Key to Success” said Chikaura.
He added that the PPP formula has worked elsewhere in the world and should work in Africa and Zimbabwe in particular.
“PPPs needs the right economic, political, legal and financial framework to be put in place to make it attractive for the private sector to invest in infrastructure development” Chikaura said.
He further added that it has been proven the world over that PPP structures cannot be effectively and efficiently Implemented without Government support.
He however noted that the Government of Zimbabwe is committed to facilitate private sector participation as ably demonstrated by the office of the Deputy Prime Minister.
“Honorable Professor Arthur Mutambara is currently championing the PPP initiative at the highest political level. His office is facilitating the crafting of a PPP policy, as well as the institutional and regulatory framework for Zimbabwe. Once adopted and passed into law, the framework will facilitate private sector participation in infrastructure development” said Chikaura.
“Case studies from South Africa and other places have also shown that the setting up of a PPP unit to administer a national PPP programme is a key success factor” Chikaura added.
Also addressing the seminar Mr. Kurt Reitz from DPM, Mutambara’s office emphasized for the need to establish a PPP unit within the Government, to ensure operational accountability.
According to the European Commission report of 2003, whether PPP units have a centralized or decentralized approach, countries have realized the importance of using well-trained experts to initiate and drive the PPP process. These experts have been key drivers in developing capabilities, building legal and regulatory structures, stimulating market interest and initiating pilot projects in order to test and demonstrate the value of PPPs.
Of great note were contributions from Africana Finance and Investments director and seminar facilitator Mr. Siyanga Malumo, who noted that cooperation between the public and private sectors is as old as modern man.
“Public-Private sector joint venture covers social, economic and religious aspects of life over centuries. The new wave of PPPs was started in 80s in the United Kingdom by Margaret Thatcher when she needed to mobilize resources for her country.
Africa is well positioned to drive the next wave of PPPs.PPP projects from 1996-2006 have proved that they is great value in partnering.”
He defined PPP, as a legally constituted relationship between the state or its agencies with private sector firm(s) in which the later substitutes the former in the provision of public goods and services over a specified or indefinite period from mutual benefits.
He further cited key objectives of PPP as the facilitation of Government service delivery, public debt reduction, promotion of public sector savings, value for money and attraction of private sector in public goods and services investment.
Malumo added that for PPP to work all stakeholders including the public(ranging from parents, students, patients to roads , harbours, railway and airport users etc), Government , investors (private), farmers, industrialists, financiers, traders, environmentalists, donors, NGOs and other special interest groups must be taken on board.
He advised the government of Zimbabwe to learn few lessons from projects like, Tegeta and Ubungo of Tanzania, Cahora Bassa of Mozambique, Mwamabula of Botswana, Inga 1 and 2of DRC and Itezhi-Tezhi and Kariba North Bank Extension of Zambia.
According to the World Bank Report of 2010 – 2020 between 1996-2006, Latin America and Caribbean had undertaken 894 projects worth US$287 billion and East Asia and Pacific accounted for 847 projects worth
US$158,8 billion while Sub-Saharan Africa managed only 289 projects worth a merely US$40,7 billion a clear sign that Africa is lagging behind.
Adding his voice to the seminar Joao Munguambe from Mozambique said PPP unit was established in 2006 at Maputo municipality with the mandate of identifying, designing, promoting and implementing PPPs, to date 26 small and medium PPPs have been implemented with the value of US$100 million and currently a major PPP estimated US$5 billion
(urbanization) is in the process for being implemented.
He further said the construction and development of municipal car park in Maputo central market was a major achievement of a PPP in Mozambique.
“The need for urgent response to the growing difficulty to find a park in Maputo City particularly close to the central market located in a very important touristic, commercial and services area, created the appropriate environment and business opportunity for private investment” said Munguambe
Although there is no legal framework in Mozambique to deal with PPPs, Munguambe said there are various decrees which allow municipalities to develop and explore relationships with private sector which were used by Maputo municipality to pioneer on PPPs.
Munguambe believed that a legal framework currently under preparation will give a considerable impulse to the mechanism which will facilitate major involvement of private sector and access to finance.