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Overview on the Development of the Egyptian PPP Program. Bassel Shoirah Utilities Sector Officer PPP Central Unit Ministry of Finance “ Capacity-Building Workshop on Public Private Partnerships” Intercontinental Hotel Amman, Jordan April 28-29, 2008. Agenda. PPP Program in Egypt

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Overview on the Development of the Egyptian PPP Program

Bassel Shoirah

Utilities Sector Officer

PPP Central Unit

Ministry of Finance

“Capacity-Building Workshop

on Public Private Partnerships”

Intercontinental Hotel

Amman, Jordan

April 28-29, 2008


Agenda

PPP Program in Egypt

PPP Policy Framework – Implementation

Main Legal & Commercial Aspects of PPP Transactions

Role of the PPP Central Unit

Key Problems and Issues

Goals and Expectations

PPP Pilot Projects


PPP Program in Egypt

  • PPPs are key to the Government’s economic reform agenda and strategy to increase private sector involvement in public services through leveraging private spending against public spending

    • Provide a new source of investment capital for required infrastructure projects

    • Reduce Government sovereign borrowings and associated risks

    • Drive the creation of local long term funding market

    • Utilize efficiencies of private sector in running public services

    • Expand economy and stimulate job creation

    • Increase quality of public services to the Egyptian citizen


PPP Program in Egypt (cont’)

Fundamental Aspects of Egypt’s PPP Policy Framework

  • Performance-based contract under which the Private Sector supplies public services over time and is paid by the Public Sector, end user or a hybrid of both. Output is specified by Line Ministries while input is the responsibility of the private sector

  • Under the PPP contract:

    • The Government retains total strategic control on the service

    • The Government secures new infrastructure which becomes Government assets at the end of contract life

    • Project and performance risks are allocated to the party best able to manage or mitigate


PPP Policy Framework

Egypt is providing the right environment for implementation

  • Adoption and localisation of international successful PPP models (UK)‏

  • Provision of Supportive Legislative Environment

    • New Legal Framework for PPP Projects

      (Draft under finalization for Submission to Cabinet and Parliament)‏

    • Standard PPP Contracts

    • Standardization of procurement documentation and procedures

  • Creation of regulatory bodies for post contract implementation


PPP Policy Framework(cont’)

Implementation Strategy

  • Placing clearly PPP initiative within reform macro fiscal agenda

  • Establishing a PPP Central Unit at Ministry of Finance as well as Satellite Units in Line Ministries

  • Identifying PPP’able projects as part of Line Ministries’ 5 years Strategic Plan

  • Providing legislative framework – PPP Law

  • Developing Tool Kit for implementation of projects


PPP Policy Framework(cont’)

Implementation Strategy (cont’)

  • Finalizing budgetary and accounting practices to capture PPP transactions

  • Setting “Best Practice” precedence through pilot projects

  • Arranging for Credit Enhancement mechanisms

  • Stimulating domestic banking sector to offer longer tenors and competitive pricing


Main Commercial & LegalAspects of PPP Transactions

  • Risk mitigation

  • Availability payments upon acceptance certificate

  • Inflation and interest rate indexation

  • Ministry of Finance support to contractual payments

  • Conflict Resolution techniques

  • Direct Agreement and step-in rights for Funders

  • Compensation for termination/ extra-ordinary events/ direct impact on change of Laws

  • All transactions are in local currency


Role of PPP Central Unit

  • Act as a Public face of PPP initiative in Egypt since June 2006

  • Establish a national PPP policy framework for implementation

  • Set PPP guidelines and methodologies appropriate to Egypt

  • Draft and issue standard project documents, contracts and PPP laws

  • Coordinate the PPP program and process across Line Ministries, private sector and funding market

  • Report to Ministerial Committee for projects approval and recognize issues that may impede the PPP program

  • Identify PPP able projects as part of Line Ministries’ 5 years strategic plan


Role of PPP Central Unit(cont’)

  • Manage PPP transactions and provide technical and advisory support as well as ensure compliance with legislative framework

  • Supervise Tendering and Performance Monitoring Committees

  • Act as:

    • Center of PPP Expertise, Support and Intelligence Gatherer

    • Center for Capacity Building

    • Central Complaints Resolution Office for PPP Investors


Key Problems and Issues

  • Public perception of PPP's as privatization

  • Resistance to change / Project ownership issues

  • Project screening

  • Bankability of projects

  • Project execution and performance monitoring

  • Local funding accommodating PPP transactions


Goals and Expectations

  • Develop action plan to overcome obstacles and key impediments

  • Share Egyptian experience internationally

  • Acquire academic aspects of PPP project structuring

  • Enhance strategies‘ & setting capabilities of team members

  • Act as a Center of Expertise on a national & regional basis

  • Provide ownership for PPP projects amongst both Public & Private Sectors


PPP Pipeline Projects

Social Infrastructure

  • Education Sector

  • Health Sector

    • Educational Medical Facilities

    • General Medical Facilities

  • Utilities Sector

    • Wastewater Treatment Plants

  • Transportation Sector


  • Education Sector

    1800 Public Schools

    Overview

    • Location: 27 Governorates

    • Project Duration : 15 Years

    6 Batches of Approx 350 to be tendered over 5 years

    Project Structure

    SP to finance, design, build, furbish & maintain schools, provide non educational services & transfer ownership to government at contract end.

    Timeline

    • 1st Batch Launch date: November 2007

    • Project Awarding date : June 2008

    • Schools availability date: 2009 / 2010


    Health Sector

    Educational Medical Facility - 1

    Overview

    • Location: University of Alexandria

    • Capacity : 230 Beds

    • Project Duration : 20 Years

    Construction of a new Specialized University Hospital (Al Mowassat) in Alexandria Governorate as:

    i) Neuro - Center

    ii) Urology / Nephrology Center

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : May 2008

    • Project Awarding date : January 2009

    • Operation date: December 2011


    Health Sector

    Educational Medical Facility - 2

    Overview

    • Location: University of Alexandria

    • Capacity : 200 Beds

    • Project Duration : 20 Years

    Construction of a Gynecology / Obstetrics University Hospital as part of Smouha Medical Complex, as well as a Blood Bank with a capacity of 200,000 bags / year, in Alexandria Governorate

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : May 2008

    • Project Awarding date : January 2009

    • Operation date: December 2011


    Health Sector

    General Medical Facilities - 1

    Overview

    • Location: Cairo Governorate

    • Capacity : 300 Beds - General Hospital

      • 100 Beds - Oncology Center

  • Project duration : 20 Years

  • Demolition and Re-construction of Al Abassia Chest Hospital and change scope to a General Hospital, plus a separate building for Oncology Center

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : July 2008

    • Project Awarding date : July 2009

    • Operation date: December 2011


    Health Sector

    General Medical Facilities - 2

    Overview

    • Location: Cairo Governorate

    • Capacity : 230 Beds

    • Project duration : 20 Years

    Demolition and Re-construction of Boulak General Hospital

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : July 2008

    • Project Awarding date : July 2009

    • Operation date: December 2011


    Health Sector

    General Medical Facilities - 3

    Overview

    • Location: Beheira Governorate

    • Capacity : 100 Beds / hospital

    • Project duration : 20 Years

    Construction of 3 Central Hospitals

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : September 2008

    • Project Awarding date : September 2009

    • Operation date: December 2011


    Health Sector

    General Medical Facilities - 4

    Overview

    • Location: Cairo Governorate

    • Capacity : 100 Beds

    • Project duration : 20 Years

    Construction of a Re-habilitation Center

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : September 2008

    • Project Awarding date : September 2009

    • Operation date: December 2011


    Health Sector

    General Medical Facilities - 5

    Overview

    • Location: Alexandria Governorate

    • Capacity : 100 Beds

    • Project duration : 20 Years

    Construction of Oncology Center

    ProjectStructure

    SP to finance, design, build, equip, furnish, maintain, provide non clinical services & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : December 2008

    • Project Awarding date : December 2009

    • Operation date: December 2011


    Utilities Sector

    Wastewater Treatment Plant - 1

    Overview

    • Location: New Cairo

    • Capacity : 250,000 m3/day

    • Project duration : 25 Years

    Project Structure

    SP to finance, design, build, operate, maintain plant & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : October 2008

    • Project Awarding date : September 2009

    • Operation date : December 2011


    Utilities Sector

    Wastewater Treatment Plant - 2

    Overview

    • Location: Abo Rawash - Giza

    • Capacity : 800,000 m3/day

    • Project duration : 25 Years

    Expansion of a waste water treatment plant in Giza Governorate to raise capacity up to 2,000,000 m3/day

    Project Structure

    SP to finance, design, build, operate, maintain plant & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : December 2008

    • Project Awarding date : September 2009

    • Plant Operation date: December 2011


    Utilities Sector

    Wastewater Treatment Plant - 3

    Overview

    • Location: Gabal Asfar - Cairo

    • Capacity : 500,000 m3/day

    • Project duration : 25 Years

    3rd phase expansion of a wastewater treatment plant with capacity of 500,000 m3/day to raise capacity up to approx. 3,000,000 m3/day

    Project Structure

    SP to finance, design, build, operate, maintain plant & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : January 2009

    • Project Awarding date : September 2009

    • Plant Operation date: September 2012


    Utilities Sector

    Wastewater Treatment Plant - 4

    Overview

    • Location: Helwan

    • Capacity : 500,000 m3/day

    • Project duration : 25 Years

    Project Structure

    SP to finance, design, build, operate, maintain plant & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : January 2009

    • Project Awarding date : September 2009

    • Plant Operation date: September 2012


    Utilities Sector

    Wastewater Treatment Plant - 5

    Overview

    • Location: 6th October city - Giza

    • Capacity : 450,000 m3/day

    • Project duration : 25 Years

    Project Structure

    SP to finance, design, build, operate, maintain plant & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : October 2008

    • Project Awarding date : April 2009

    • Plant Operation date: April 2012


    Utilities Sector

    Wastewater Treatment Plant - 6

    Overview

    • Location: Nahia - Giza

    • Capacity : 200,000 m3/day

    • Project duration : 25 Years

    Project Structure

    SP to finance, design, build, operate, maintain plant & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : October 2008

    • Project Awarding date : April 2009

    • Plant Operation date: April 2012


    Transport Sector

    Cairo / Alexandria free road

    Port Said / Matrouh free road

    Overview

    • Length : Cairo / Alex 162 kms

      • Link to Coastal Road 25 kms

      • Alex / Matrouh 280 kms

      • Port Said / Alex 285 kms

  • Description: Connection of all of Egypt’s Mediterranean Ports

  • Project duration : 20 Years

  • Project is to build & upgrade existing roads and transfer to free roads

    Project Structure

    SP to finance, design, build, operate & maintain road & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : June 2008

    • Project Awarding date : January 2009

    • Project Operation date: June 2012


    Transport Sector

    Railway Project -1

    Overview

    • Location: Cairo / 10th of Ramadan City

    • Length: 77 km

    • Description: Double track line

    • Project duration : 20 Years

    The Project is to Double the current line from Ain Shams to El- Roubaky (45 km) & Build a new line from El- Roubaky to 10th of Ramadan City (32 km)

    Project Structure

    SP to finance, Upgrade existing tracks & stations, Construct new tracks & stations, Operate, Maintain & transfer ownership to Government at contract end.

    Timeline

    • Launch Date : August 2008

    • Project Awarding date : January 2010


    Transport Sector

    Railway Project - 2

    Overview

    • Location: Alexandria / Borg El Arab

    • Length: 50 km

    • Description: Double track line

    • Project duration : 20 Years

    The Project is to Double the current line from Alexandria to Borg El-Arab (50 km)

    Project Structure

    SP to finance, Upgrade existing tracks & stations, Construct new tracks & stations, Operate, Maintain & transfer of ownership to Government at contract end.

    Timeline

    Under Due-Diligence


    Transport Sector

    Maritime Projects

    Overview

    • Description: Investment opportunities include:

      • New container terminals

      • Multi purpose terminals

      • Liquid bulk terminals

      • General cargo terminals

      • Vessels bunkering

      • Tugging and marine services

      • Stevedoring

      • Value added activities and services

      • Shipyard, Ship repair

    • Location

      • Sokhna, Damietta

      • Alexandria & Dekhela

      • Port Said – East Ports

    Timeline

    Under Due-Diligence


    Transport Sector

    River Transport Project - 1

    CAI / Damitte

    240 km.

    CAI / Alex.

    220 km.

    Overview

    CAI / Aswan

    960 km.

    • Description:

      • Developing river transportation fleet

      • 4 main routes:

        • Cairo /Alexandria 220 km

        • Cairo /Damietta 240 km

        • Cairo /Aswan 960 km

        • Aswan / Wadi Halfa 350 km

    Aswan / Wadi Halfa

    350 km.

    These routes creates multiple development opportunities, commercial & services centers, added value services & also the fleet could serve commercial transportation to Sudan.

    Timeline

    Under Due-Diligence


    Transport Sector

    River Transport Project - 2

    • Description:

      • Developing new river ports terminals

      • 7 main ports:

        • Upper Egypt

          • Sohag River Port

          • Assiut River Port

          • El Tebeen River Port

          • Kena River Port

        • Delta

          • El Nahda River Port

          • El Nahda Port Extension

          • Meat Ghamr River Port

    Timeline

    Under Due-Diligence


    Thank You

    Contact Details:

    PPP Central Unit

    Ministry of Finance

    Tel: +202 23421283

    +202 23421284

    Fax: +202 23421283 / 84

    ext. 6152

    e-mail:[email protected]

    Web:pppcentralunit.mof.gov.eg


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