GLOBAL: Sustainable KP-PPP Contract Renegotiations

The proposed activity is motivated by a high incidence of contract renegotiations in PPP projects. The PPP contract renegotiation is common in Latin America, but also in other parts of the world, such as India, Portugal and Korea, among others. This exploratory work assesses data availability and limitations on PPP contracts that were renegotiated after reaching commercial and financial close between 2000 and 2010. The team identified Mexico as the pilot country for the study based on a specific set of selection criteria and high willingness of the country to publicly share the information on contract renegotiation. The team administered the desk review of the available data and conducted a survey to collect country experience in project renegotiation and its impact on the contract. The analysis and findings were summarized in a report. Although there is no specific timeline for scale-up of the pilot study, in light of the current COVID-19 situation, a large number of renegotiations that is expected. Therefore, a follow-up to this activity would benefit PPIAF's and World Bank's body of knowledge on contract renegotiations.