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Public-Private Partnerships in Mongolia. Now and Futures Prospects. E.Enerelt , ADB. June 6, 2014. WHAT IS PPP?. ADB’s PPP Operational Plan (mid-2012) defines public-private partnership as:
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Public-Private Partnerships in Mongolia Now and Futures Prospects E.Enerelt, ADB June 6, 2014
WHAT IS PPP? ADB’s PPP Operational Plan (mid-2012) defines public-private partnership as: • “… a contractual arrangement between public (national, state, provincial, or local) and private entities through which the skills, assets, and/or financial resources of each of the public and private sectors are allocated in a complementary manner, thereby sharing the risks and rewards, to seek to provide optimal service delivery and good value to citizens.” NOT Public procurement Privatization
WHY CHOOSE PPP? Risk transfer • Disadvantages: • Off-balance financing • Cost of capital is expensive • Can be complex and difficult to implement Whole of life-costing/ maintenance Innovation Maximization of asset utilization Mobilization of additional resources
SHARE OF PUBLIC INVESTMENT DELIVERED THROUGH PPPs IN 2011 Source: Burger and Hawkesworth (2013). OECD.
ADB SUPPORT FOR PPPs IN MONGOLIA • ADB’s country partnership strategy for Mongolia, 2012–2016 - Inclusive and sustainable growth; - Support for PPPs will bring in private financing for the infrastructure needed to improve access to essential public services. • Current Status - ADB has supported Mongolia’s PPP work since 2009: 1. The first technical assistance (TA) helped draft the Concessions Law and establish a PPP Unit as a coordinating body for PPPs; 2. A follow-on TA strengthened PPP regulations, helped build the capacity of the PPP Unit and develop a pipeline of PPP projects and more; 3. The third TA, “Developing a Conducive Environment for PPPs”, was approved in December 2012. - In June 2011, ADB was appointed as the mandated adviser to the PPP for CHP5, the mandate was renewed in December 2013 (A $1.2 million TA that will fund additional advisers); - Other IFIs and countries such as the World Bank Group are in discussion with the government.
PPP legal framework • Parliamentary Ad hoc committee on PPPs - Nov 2008 • State Policy on PPP - Oct 15, 2009 • to promote private sector participation in all sectors of economy • The Law on Concession - Jan 28, 2010 • Defines the processes of PPP implementation. • In 2010, the Government has approved several regulations regarding the detailed bidding process and evaluation of bid proposals
III. List of Concession projects • In 2010, the Government approved the list of 121 concession projects. • The Cabinet made amendments to the list of Concession projects (reduced to 51 projects) 2013.09.06 №317
By sectors • Infrastructure – 7 • Road and transportation – 17 • Pipeline transport – 2 • Airport – 2 • Energy -12 • Environment – 4 • Education - 2 • Health – 1 • Culture and sport - 4
By types of PPP • BOT – 8 • BOO – 12 • BT – 19 • OTHER - 12
Contact: EnereltEnkhbold eenkhbold@adb.org