Public Private Partnership
Development of PPPs in the Lao P.D.R.
Acknowledging that public investment and private investment are equally important to the development of Lao socio-economy, the Lao Government has realized the importance of Public Private Partnerships (PPPs) as the powerful tool in promoting joint development between the government and private sector in the delivery of public goods/infrastructure and services, ensuring social benefits with sustainability, transparency and accountability principles.
The Lao Government is developing the framework for PPPs in Lao PDR, led by the Investment Promotion Department of the Ministry of Planning and Investment (MPI) with support of the Asian Development Bank (Governance and Capacity Development in Public Sector Management Program-GRANT-0309 LAO) and the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) secretariat. The initiative focuses on three main areas, namely (i) institutional capacity building, (ii) policy and legislation framework development, and (iii) demonstration of model/pilot projects in social sectors, namely education and healthcare.
Institutional Capacity Building: In order to facilitate PPP initiatives, a task force unit called the PPP Unit has been established within the Department of Investment Promotion (IPD). The task force is responsible for initiating policy and legislation development and piloting PPPs on education and healthcare. The task force has worked closely with the government concerned agencies, ADB, international organizations, civil society and the private sector.
Development of Policy and Legislation Framework: The framework includes:
- Development of a Prime Minister’s PPP Decree, consistent with international practice and complaint with Lao legislation.
The PPP Decree defines PPPs as:
- A medium or long term contractual arrangement between a Public Agency and a Private Body
- For delivery of a public service or infrastructure for which the Public Agency remains accountable
- Where the required service or infrastructure is specified as an Output
- Where significant risks are transferred to the private firm, making its private investment and financial returns linked to its performance
- That is procured through a competitive procurement process
The PPP Decree aims to promote and govern Public Private Partnerships as a regular method of delivering infrastructure and services for which the Government is responsible. The Decree will:
- Promote and support PPPs where they can improve the delivery of public infrastructure and services to maximise developmental impact and economic growth
- Ensure public awareness of the relative costs, benefits and risks of PPP
- Establish key institutional roles and responsibilities with clear mandates
- Put in place conducive, clear, transparent and enforceable PPP procedures
- Institute a transparent, competitive and rule-based tender process for solicited Public Private Partnerships and subject all unsolicited proposals to market challenge
- Prioritize major investment projects at senior political level
- Make sure that all costs and contingent liabilities arising from PPPs are recognized and where necessary provisions made in the Budget
- Guard against waste and corruption by ensuring the integrity of the procurement process
- Ensure due diligence to mitigate negative impacts on women and children and maximize their benefit within the control of PPPs and their implementation
- Development of PPP Guidelines and Manuals for facilitating and managing the implementation of PPP initiatives in Lao PDR throughout the PPP cycle.
- Investigation of different forms of PPP: including revenue-based and availability-based PPPs, etc…
The initiative commenced in mid-2013 and is aimed at completion in mid 2015.
Draft documents will be posted on the MPI web site including:
- PPP Frequently asked questions (PPP FAQ)
- PPP Policy Discussion Document
- Draft PPP Decree
=> Initial Conceptual Framework and Road map for Public-Private Partnerships in Lao PDR
The Government of Lao PDR acknowledges the poor state of public infrastructure and services in the country as being one of the main impediments to the nation achieving its economic growth and development objectives. Historically the provision of public infrastructure and services has to a large extent relied on Government budget and foreign development aid......
=> Guidelines and Checklists for Gender in Public-Private Partnerships in Lao PDR Grant 0309
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