PPP – Opportunities for the Private Sector
Singapore PPP Projects Desalination Plant PPP 30 million gallons of water per day for 20 years Construction to be completed by 2006
Singapore PPP Projects Other areas being explored: – Sports facilities – Student accommodation – Water reclamation – Incineration services – IT systems
The Right Business Model • Bankable • Competitive to traditional procurement • Optimal allocation of risks according to ability to add value Private Sector’s Public Sector’s Responsibilities Responsibilities • Promoting and marketing • Determining policy need • Commercialization • Specify requirements • Utilization of off-peak slots • Monitor performance • Design • Construction • Maintenance
Key ingredient – Partnership Win-Win Partnership
Business Opportunities Who? How? Financing Specialists Put together optimal financial package Risk Management Optimise risk allocation Specialists Business Process Select efficient service Specialists delivery processes Legal Specialists Craft healthy, robust contract
Cost Efficiency Drivers • Greater ability to manage costs • New ways of delivering the service • Providing better services • Third-party revenue • Understanding service levels required • Experience and Scale in Operations
New Market Opportunities PPP can play a developmental role for: • Small private sector markets • Fragmented markets • Growing markets
Innovation What do the customers really want? Invitation for Expressions of Step 1 Tap Private Sector’s Innovation by: Interest • 2-stage tender process Step 2 Prequalification of bidders • Market Feedback Period Request for Proposal from Step 3 selected bidders • Allow alternative innovative solutions Step 4 Market Feedback Period Issue of Final Tender Step 5 Step 6 Closing of Tender Contract Award / Financial Close Step 7
PPP is… • More opportunities for the private sector • Bringing together different skill sets • Total cost-effective solution • Greater understanding of service and risk • Long-Term Win-Win relationship
Thank You
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