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Feature Story

Increasing PPP Awareness among Government Officials in Senegal

 Senegal was listed among the least developed countries in the world with an estimated average per capita income of $770 in 2010. But the government has aspirations to become a high middle income country by the next decade and plans to become an emerging country  by 2015. This ambitious plan requires the implementation of a number of economic projects and programs and the mobilization of significant financing. In this context the government has decided to use Public-private partnership (PPP) arrangements as an alternative to purely publicly financed projects, in sectors such as transport and energy where the demand is robust, and can sustain private investments.

In the last few years, to promote PPPs , the government has  adopted several new laws and legislations: (law 2004-13) related to Build Operate Transfer (BOT) contracts, and its subsequent amendments (law n° 2009-21 of May 4, 2009); (law  2011-11 of April, 28 2011) which created an Infrastructure Council; (law 2004-14 of March 1, 2004) created a special unit dedicated to PPPs  within the department in charge of private sector development of the Ministry of Economy and Finance.

However, little has been done to increase PPP awareness among government officials in charge of the implementation of PPP projects and contracts.  Therefore, traditional forms of public procurement such as public tenders, financing on government budget of borrowings prevail and the potential benefits of PPP remain largely unexploited.

To address these challenges, the Ministry of Economy and Finance of Senegal through its direction for private sector development (DASP) initiated a request to PPIAF and its partners for support to strengthen the capacity of government officials in the management of PPP contracts.  PPIAF provided funding to organize a PPP training seminar in partnership with the IFC Advisory, the French Mission d’Appui aux Partenariats Public-Privé (MAPPP), Assistance au Développement des Echanges en Technologies Economiques et Financières (ADETEF), and African Legal Support Facility (ALSF)

The PPP seminar held over five days focused around 4 modules designed to illustrate the key issues surrounding the identification, structuring, implementation and monitoring of PPP projects and provided exposure to PPP experience in Senegal. A total of 149 participants including personnel from the Ministry of Economy and Finance, procurement managers, project leaders, PPP coordinators within other ministries, procurement managers of state-owned and parastatal companies, municipal secretaries, administrative and finance officers of local municipalities, permanent secretaries, cabinet directors and managing directors of public companies attended the seminar.  All sessions were delivered in French. Presentations made at the workshop can be accessed through the links provided below.

Module 1 included presentations on PPP Fundamentals and Project Preparation which started with an Introduction  to the module followed by a presentation on Fundamentals of PPP, Key success factors, PPP project cycle, PPP legal and institutional framework in Senegal, Socio-economic analysis, Comparative Analysis – Application to the transport sector and Scale of PPP projects and applicable sectors.

Module 2 included presentations on Risk Management and Financing of PPP Projects highlighting presentations on the Risk identification, allocation and mitigation, selecting the type of PPP, Financial modeling for PPP projects, Fiscal commitments and contingencies, Remuneration of PPP contracts in Senegal (tafiffs, user changes, subsidies, etc.), PPP financing, role of guarantees and other financial instruments and Lessons learned and case studies.

Module 3 on the PPP Tender Process through presentations on selecting the PPP tender mechanism,
Preparation of bidding and transaction documents, Bid Evaluation, Negotiation and finalization of PPP contracts and Contract award.

Module 4 focused on the Key Elements of PPP Contracts by highlighting Fundamentals of Contractual relationships, Key contractual clauses, Risk management and defaults, Contract amendments, Renegociations, force majeure, Remuneration and guarantees, Monitoring and supervision of contracts, Conflict resolution and Termination clauses, end of contract.

The event was also a great opportunity to disseminate knowledge materials from all the organizers and especially for PPIAF which has several knowledge materials and publications on the topics that are relevant to the seminar. The following PPIAF materials were made available to all participants:

  • Comment susciter l’engagement du secteur privé dans des partenariats public-privé sur les marchés émergents  (English )
  • Gridlines Note N° 20, Instruments de réduction des risques liés au financement des infrastructures: tendances récentes. (English )
  • Gridlines Note N° 27, Conception et utilisation des unités PPP dans le secteur des infrastructures (English )
  • Partenariats public-privé pour les services d'eau urbains: bilan des expériences dans les pays en développement  (English)
  • Public-Private Partnerships Reference Guide Version 1.0
  • Services d’eau et secteur privé dans les pays en développement : Perceptions croisées et dynamique des réflexions (English )

The seminar was proven to be a success following participant evaluation and feedback performed at the end of the event. The Ministry of Finance and Economics also expressed their satisfaction with the outcome of the seminar. The following follow-up items were identified which the PPIAF team will also take into account for future PPIAF support to the government of Senegal.

  • PPP pipeline screening and identification of 5 to 10 potential PPP projects which can then be presented to potential investors during a road show the government intends to organize in Paris, in October of 2013. The government of Senegal has already started the PPP pipeline screening process.
  • Support to improving the legal and regulatory framework in Senegal
  • Finding potential partnership activities with ALSF and other partners involved in the organization of the seminar

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