TUNISIA: Assisting “Tunisie Autoroutes” in Exploring Management and Financing Options of Highway Infrastructures and Identifying a Pipeline of Potential PPP Projects

With the Society of Tunisian Highways (Société Tunisie Autoroutes–STA) experiencing financial difficulties, this project aimed to grasp STA’s financial situation and explore possibilities to involve the private sector in motorways operations to reduce the company’s financial burden and preserve national highway infrastructure. In response to the government’s request, PPIAF approved a grant to conduct a feasibility study on raising commercial finance to modernize existing motorway assets as well as expedite priority network extensions. The study was developed based on the following deliverables: 

• diagnostic of STA’s status quo, including its management and financing of activities by identifying strengths and weaknesses, opportunities, and threats, 
• review of future financial requirements for planned new investments and for the management and operation of the in-service network; 
• feasibility study of possible scenarios for adequate management and financing of motorways in Tunisia; 
• workshop to present funding options and reach an agreement on the chosen scenario;  
• identifying a P3 motorway project pipeline and developing an action plan to advance the sector. 

The institutional structure assessments identified key weaknesses and recommended possible roles for STA in several management and financing scenarios. Two scenarios for future projects with private sector participation were accepted: 

1. STA as a concessionaire of the Hammam-Lif-Msaken section with private sector investment for capacity extension and maintenance; 
2. A partnership contract to operate toll collection and conduct routine maintenance of the Tunis-Jelma section (ECOSO) in return for annual rentals. 

To optimize the PPP, seven periodic investment projects were identified with three recommended contractual schemes: a concession-type scheme, a partnership contract scheme with rents for maintenance, and toll collection services. The research confirmed that six sections of the road should remain concessioned and two should remain PPPs with periodic maintenance.

This project complements and builds on two ongoing World Bank projects that are seeking to maximize private sector finance: the Maghreb Infrastructure Diagnostic, led by the Water Global Practice, and the analytical work on Tunisian state-owned enterprises (SOEs), led by the Governance Global Practice analyzing key issues and challenges affecting SOEs and informing the development of potential policy actions for future development partnership frameworks. The next steps would be to implement the study’s recommendations to support the development of the above-mentioned potential projects, increasing private capital mobilization to support the government in managing and financing its motorway infrastructure.