COMMITTEE CGPP II ENHANCING ROLE OF PRIVATE

COMMITTEE – CGPP II ENHANCING ROLE OF PRIVATE SECTOR Sam Cho, Ph. D. 9 -10 March 2011

Outline Role of the Private Sector in Africa Major Challenges Pan-Africa Investment Forum Public-Private Partnerships (PPP)

Role of Private Sector Private sector recognized as engine of growth – trade, investment & economic transformation critical role for poverty reduction – employment & income generation Growing demand role for basic service delivery – through Public-Private Partnerships (PPP) PS role in major sectors is key to sustainable development Infrastructure Industrial development Agriculture

Challenges for doing business in Africa Figure: Ten Most Problematic Factor for Doing business (African Average) Access to. . . Inadequate. . . Corruption Inefficient. . . Inadequately. . . Tax rates Tax regulations Poor work ethic. . . Inflation Policy instability 20 15 10 5 Percentage of Respose 0

Major Challenges for PSD Investment Climate & Doing Business Governance and institutional framework – including deregulation, corruption, Policy related constraints Infrastructure and public utilities Active PSD Support & business development services Sector specific issues Access to requisite resources: Supply-side Constraints: Access to finance, land technology Human Capital and Labour Regulation

Low productive capacity in Africa

Pan-Africa Investment Forum

Pan-Africa Investment Forum (PAIF) Joint Event with Strategic Partnership Energy Ministers Conference of AUC PAIF of UNECA & All Africa Energy Week of Af. DB - in Maputo, Mozambique Main activities of the Forum Thematic Conference and Business Roundtable Accomplishments Provided a much need vehicle for synergy of activities between all stakeholders involved; Successfully established a continental-level platform to promote private sector participation in key infrastructure and energy sector through PPPs and policy dialogue.

PAIF (cont’d) THEMATIC CONFERENCE q Investment for infrastructure development in Africa q Cases and best practices q Regional infrastructure development q Emerging opportunities and institutional support BUSINESS ROUNDTABLE q Focus on promoting investment: q Business consultations based compiled pipeline projects at both sub-regional and country levels; q Presentations on projects in infrastructure and potential package investment deals at sub-regional and country levels; and q Networking and policy dialogue with international investors.

Lessons learnt & way forward q Need for platform / forum at sub-regional level for policy dialogue and investment facilitation and promotion q Ministerial roundtable is critical for policy dialogue with the private sector q Need for a Database of pipeline projects, with a particular emphasis on infrastructure q Pivotal role of the private sector in sub-regional and regional infrastructure development.

Public-Private Partnerships (PPP) In Africa

Rationale and role q Why PPP in Africa? q q q Insufficient state investment Growing pressure on government budgets and Inefficient provision of services by State Effective mechanism for resource mobilization Enhancing PS participation PPP as an alternative for privatization q PPP situated between government monopoly and complete privatization while avoiding some of the pitfalls of privatization: unemployment, higher prices and corruption

Current Work Series of activities on PPPs Publication on “PPPs in Public Service Delivery - the Energy and Related Sectors in Africa” Expert Group Meeting on “PPPs: Challenges, Best Practices and New Trends” Capacity building outputs/activities – government officials

PPPs – to do Work with partners to: Address challenges through publications and workshop Establish PPP implementation framework Build PPP coalition and network Create PPP fund for capacity building

Thank you!