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Overview of ADB Support for Partnerships with Non-State Actors

Overview of ADB Support for Partnerships with Non-State Actors. Presentation for ADB-UNICEF Regional Workshop on The Role of Non-State Providers in Delivering Basic Social Services for Children April 19, 2010 By Jon D. Lindborg, Southeast Asia Department. Outline.

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Overview of ADB Support for Partnerships with Non-State Actors

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  1. Overview of ADB Support for Partnerships with Non-State Actors Presentation for ADB-UNICEF Regional Workshop on The Role of Non-State Providers in Delivering Basic Social Services for Children April 19, 2010 By Jon D. Lindborg, Southeast Asia Department

  2. Outline • Global Context for Partnerships • ADB Context for Partnerships • ADB Engagement with Non-State Actors • ADB and Public-Private Partnerships • Summing Up and Some Possible Discussion Points

  3. Global Context: Proliferation of Development Partnership Channels • Over 60 bilateral donors (“legacy” and new players) • Over 230 international organizations • 1000s of non-government (NGO), community (CBO), civil society (CSO) and faith-based (FBO) organizations • Emergence of new players driving new approaches/innovation: • Private Sector Corporate Social Responsibility (CSR) activities • Large Foundations: • Bill and Melinda Gates Foundation ($33.5 billion endowment) • “Vertical Funds” focused on specific issues/themes: • Global Fund for AIDS, TB and Malaria • Global Alliance for Vaccines and Immunization (GAVI) • Social Entrepreneurship Funds, e.g. Skoll Foundation and Acumen Fund

  4. U.S. Capital Flows to Developing World: Non-Official Flows Matter More Source: U.S. Agency for International Development (USAID)

  5. Global Context: A Wide Range of Public-Private Relationships • NGO and CBO partnerships • Corporate Social Responsibility activities • Formal or informal “alliances” such as USAID’s Global Development Alliance (GDA) • Formal Public-Private Partnerships (PPPs) involving: • Some contractual relationship between a government and non-state actor to provide infrastructure and/or services • Risk-sharing between the partners • Defined outputs and service delivery standards

  6. PPPs: More than Steel and Concrete From Economic Assets to…Social Services & Public Administration

  7. Partnerships: Central to ADB Efforts to Fighting Poverty in Asia and the Pacific

  8. ADB “Strategy 2020” Context for Partnerships • ADB Strategy 2008-2020 • Three Development Agendas: • Inclusive Economic Growth • Environmentally Sustainable Growth • Regional Integration • Five Core Operational Areas: • Infrastructure • Environment, including Climate Change • Regional Cooperation and Integration • Financial Sector Development • Education • Scaling up private sector to generate growth and reduce poverty: By 2020, 50% operations private sector-related

  9. ADB “Strategy 2020” Context for Partnerships • Five Drivers of Change: • Private Sector Development • Good Governance and Capacity Development • Gender Equity • Knowledge Solutions • Partnerships, including: • Other donors & international development agencies • Private sector • NGOs, CBOs, Civil Society Organizations (CSOs)

  10. CSOs Seen as Supporting Quality of ADB Operations • Add value to sustainable development by introducing: • Innovation • Accountability • Responsiveness • Participation • Sustainability • Role of ADB’s NGO and Civil Society Center (NGOC) ADB COOPERATION WITH CIVIL SOCIETY ANNUAL REPORT 2008 See http://www.adb.org/ngos/ngocenter.asp#1st for more information

  11. ADB Has a Mandate for Increasing Engagement with Civil Society

  12. Public-Private Partnerships (PPPs) in SE Asia Region: More Hype than Reality? • Expectations very high • Since 1988 about 330 projects in Southeast Asia with varying degrees of success: • Unsolicited proposals, e.g. Indonesia power/roads in 1990s • Philippines experience with N. Luzon Expressway; water sector • Bottom line: An uneven track record and even some skepticism

  13. No. of PPP Projects in Selected SE Asia Countries(Financial Closure 1998-2008) Source: World Bank PPI Database

  14. PPPs in Southeast Asia – State of Play • PPP pipelines are weak • International infrastructure-financing banks have been severely constrained, some signs of improvement • Limited lending capacity of local banks to fill gap brought by decline of external financing • Investors remain interested…but need committed governments • Status • Vietnam: IPPs, roads, PPP policy & unit • Indonesia: more fiscal space, ‘crash’ electricity generation program, overall PPP framework • Philippines: continued privatization of power assets, ??? • Laos & Cambodia: hydropower • Greater Mekong Region power trade: Thailand, Cambodia, Laos and Vietnam Source: ADB Special Evaluation Study on PPP, September 2009

  15. The “Political Economy” of PPP: Need to Recognize Lingering Perception Challenges

  16. ADB Approach to Mainstreaming PPPs: - Regional Departments, e.g. Southeast Asia Department (SERD) - Regional and Sustainable Development Department (RSDD)- Private Sector Operations Department (PSOD) ADB also supports complementary reforms in infrastructure and financial sectors

  17. ADB Projects with PPP-Related Support 1998-2008 Public Sector Loans Private Sector Operations Source: ADB Review of ADB Assistance for PPP in Infrastructure Development, August 2009

  18. ADB Experience with Infrastructure PPPs….Key Lessons from Special Evaluation Study • Sustained political will and champions key to success • Not universal solution or panacea • Need to address policy and sector investment reforms • Development of institutional, legal and regulatory frameworks • Specialized PPP unit support services as generally useful • Building a realistic project pipeline of bankable projects • Feasibility studies • Project preparation • Tendering and negotiations • Critical role of highly specialized technical/finance/legal experts • Need long-term engagement Source: ADB Special Evaluation Study on PPP, September 2009

  19. Summing Up and Some Possible Discussion Points • Substantial regional/global experience in provision of infrastructure through PPPs, including water/sanitation • Social sector PPPs as more challenging • Cannot ignore the “political economy” of PPP: citizens are more likely to tolerate low quality under public management than under a PPP • Importance of robust project development support to make projects “bankable” • Need to be careful not to “oversell” benefits of PPP without effective public sector capacity development and accountability mechanisms

  20. Thank You

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