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Challenge

The Government of Cambodia recognized the potential risks associated with Public Private Partnerships from the fact that the development, bidding and ongoing costs in PPP projects are likely to be greater than for traditional government procurement processes, and the PPP debt has to be borne by customers or the government through subsidies. While some projects may be easier to finance, some may be more politically or socially challenging especially if significant tariff increases are required to make the project viable or if there are significant land or resettlement issues. Lastly, continuing Government responsibility– citizens will continue to hold government accountable for quality of utility services plus many more. The challenge for the Cambodian Government was how to manage these risks, while capturing the benefits of PPP.


Strategy

Our team of international experts worked with the Government to design and develop a Capacity Building Program: Training and Support under the Framework for Improving Governance in the Management of Private Participation in Infrastructure in Cambodia, improving organizational capacity at both central and provincial/ municipal levels to undertake the effective management, delivery, and implementation of PPI transactions in a fair, transparent and competitive manner. Draft PPP contract models were prepared as the basis for identifying all the issues that need to be agreed with private sector participants in any PPP process, including any risks to Government that needed to be mitigated. The models were accompanied with detailed PPP Contract guidance notes to allow for effective management and participation by the local and central government bodies.


Transformation
The Government and officials were armed with a detailed risk management process for developing, bidding and managing potential PPP projects, including templated contract models and guidance notes for future reference.

  • Building modern, sustainable, and reliable infrastructure is critical for meeting the rising aspirations of billions of people around the globe.
  • Infrastructure investment helps raise economic growth rates, offers new economic opportunities, and facilitates investment in human capital.
  • PPPs can be a tool to deliver much needed infrastructure services.
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