An International Cooperation Enterprise for Sustainable Development Public-Private Partnership in GTZ – Slide 1 Public-Private Partnerships The PPP-Concept.

Public-Private Partnership in GTZ – Slide 1

An International Cooperation Enterprisefor Sustainable Development

Public-Private PartnershipsThe PPP-Concept of GTZ

Nadja Steffens, PPP-MENA

Working Group

„Cooperation with German/European Private Business Sector“

Cairo, April 5th 2006



Background (1) – private companies Background (1) – private companies shaping developmentshaping development

Globalization: ongoing expansion of international production and service networks

FDI twice as high as ODA

FDI and ODA in development countries in billion US $

200

0

100

50

150

FDI

ODA

200219931990 1996 1999 2004



Background (2) – private companies Background (2) – private companies shaping developmentshaping development

Dialogue between state, civil society, private sector has gained importance

Companies increasingly care about social responsibility (CSR)

Private sector provides wide range of know-howbroad range of (fast changing) knowledge cannot be held by state



… … the effectthe effect

The size of this private-sector engagement has significant side-effects:

Companies make important contributions to the development of our (partner) countries: they

transfer new technologies

train local workers

help improve the quality of local products and services

create jobs, sources of income and stable trading relations



PPPGoals of Private Sector Businesses

Goals of DevelopmentCooperation

This means that there are many potential This means that there are many potential fields for cooperation between the two sides !fields for cooperation between the two sides !

The answer

The answer

1999: German Government creates Public Private Partnership Programme to make use of this trend for development policies



Objective of PPPObjective of PPP

Sustainability on the basis of a long term economically driven engagement

Use of resources of the private sector in order to achieve development policy goals

Access to technologies and know-how

Promotion of social responsibility of companies

Support of Technical Assistance



Some Rules Apply – the “PPP Criteria”Some Rules Apply – the “PPP Criteria”

Everyone benefits: entrepreneurial success for the private partner and benefit for society, industry, administration, etc.

Projects in line with objectives of German Government‘s development policies and sector focuses in the country

Substantial contribution of the company (in cash and/or in kind)

Shared risk (the company can only realise the project with a partner like GTZ)

PPP IS NOT A TOOL OF FOREIGN TRADE PROMOTION

No subsidies !



Basic Characteristics of the PPP ConceptBasic Characteristics of the PPP Concept

Projects are jointly planned, financed, implemented & evaluated

Each partner brings in their special strengths

Sustainability (through commercial interest/long term engagement, ROI of the private partner)

All kinds of enterprises can participate (big/small; multinational/national)

PPP is possible in (almost) all sectors (no drugs, no arms….)



33 Pillars of one Strategyof one Strategy

PPP Facility

Laboratory

Initial funding

Visibility of GTZ

Integration

Embedded in TC to reach

programme objectives

StrategicAlliances

One topic

different countries

Strategic partners

Structural changes



Special funds provided by BMZ

innovative projects

as incentive to test the instrument

Only German / European companies! GTZ: max 200.000 Euro Duration max. 3 years

Managed by PPP office at HQ Each country has one PPP Project Manager

397 projects implemented Public share: 66,8 Mio € Private share: 119,6 Mio €

PPP Facility

Laboratory

Initial funding

Visibility of GTZ

PPP-Facility PPP-Facility

(1999)(1999)



PPP is part of normal TC business

Cooperations with private sector partners contribute to reach TC Programme objectives

Public funds come from the TC budget

Local companies admitted as well

Duration and public contribution as allows TC

Managed by AV of TC Programme

PPP office advises

248 in 50 TC-Programme

public share: 19,0 Mio € / private share: 35,9 Mio €

Integration (2002)

Integration

Embedded in TC to reach

programme objectives

… … more flexible than PPP facility!more flexible than PPP facility!



Strategic Strategic alliancesalliances

StrategicAlliances

One topic

different countries

Strategic partners

Structural changes

… … are PPP projects …are PPP projects … Dealing with one topic

Implemented in several countries or regions

With strategic partners like business associations (AVE) or TNCs (Holcim, etc.)

Aiming at structural changes in one sector worldwide or new topics for one region

Examples (besides AVE and 4C):Examples (besides AVE and 4C): AVE, Common Code for the Coffee Community, Uhde GmbH



Overview of Overview of PPP activities PPP activities

in the MENA-Regionin the MENA-Region



30%

27%13%

10%

10%

7% 3%

Egypt

Tunesia

Jordan

Algeria

Marocco

Syria

Yemen

PPP-FacilityPPP-Facility

Regional division of projects

19 Projects implemented, 11 Projects currently being implemented

Σ 30 Projects (since 1999)

5 Projects in Pipeline



PPP-FacilityPPP-Facility

Sectoral Division of projects

53%

20%

10%

7%

7% 3% EconomicReformEnvironment

Water

VocationalTrainingHealth

Agriculture

Volume of PPP-projects - Public share: 3,6 Millon €

- Private Share & Third Parties: 5,4 Million €

- Mobilisation coefficient: 1,5



35%

25%

15%

10%

5%

5% 5%

Tunesia

Egypt

Algeria

Jordan

Marocco

Palestine

Syria

PPP Integration in Technical CorporationPPP Integration in Technical Corporation

Regional division of projects

4 Projects implemented, 16 Projects currently being implemented

Σ 20 Projects (since 2002)

1 Project in Pipeline



PPP Integration in Technical CorporationPPP Integration in Technical Corporation

Sectoral Division of projects

40%

35%

20%

5% VocationalTraining

Environment

Water

EconomicReforms

Volume of PPP-projects - Public share: 2,1 Millon €

- Private Share & Third Parties: 3,1 Million €

- Mobilisation coefficient: 1,5



Thank you for your Thank you for your attention!attention!



1.) How does your topic particularly contribute 1.) How does your topic particularly contribute to employment promotion or employment to employment promotion or employment creation ?creation ?

Example BEGECA in Syria: 8 producers of medecine/generica (GMP-Standards) – nonprofit-market, increase in demandemployment creation

Example IPP in Algeria: Sale of treated sewing sludge as fer tilizer (job creations on different levels of the supply chain – in the waste water treatment, sales and marketing strucures employment creation

Different Examples of Vocational Training in Egypt: Pimdi German Egyptian Welding Centre

employment promotion



2.) Describe specific interventions for technical 2.) Describe specific interventions for technical cooperation projectscooperation projects

How can the private sector contribute to the objective of the TA-project/programme?

Contacts and dialogue

Special acquisition

PPP possible in nearly all sectors (Vocational Training, Water, Environment, Health, etc.)



3.) Describe achieved or expected 3.) Describe achieved or expected results/impacts and their sustainability.results/impacts and their sustainability.

Companies that “come along”



4.) Give evidence in form of case studies, best 4.) Give evidence in form of case studies, best practices or lessons learnt.practices or lessons learnt.

Example of method of GTZ Jordan

Lessons Learnt – next slide



Back-up: Lessons LearntBack-up: Lessons Learnt

Langfristiges Interesse der UN und wirtschaftliche Stärke in angemessenem Verhältnis zum Eigenbeitrag

Formulierung klarer, tatsächlich erreichbarer Ziele (Wirkungskette)

Schaffung von Transparenz über Interessen der Partner

“Keep it simple” (Verfahrensschritte, Anzahl der Partner)

Realistische Bewertung von Inkind-Leistungen

Regelmäßige Abstimmung mit Partner



Possible measures in order to promote PPPPossible measures in order to promote PPP

Spezielle PPP-ASP in allen Ländern

Operationspläne

Instrumententraining LMI (Supportstruktur)

PPP-Kennungen nachhalten

Kommunikation verbessern (Webseite des B3 – PPP neu ab Mai)

Multiplikation von Best Practices



Welche konkreten Beratungsbedarfe gibt es?

Können deutsche/lokale Unternehmen gezielt angesprochen werden?

Frage an die AVs: In welcher Weise können Unternehmen der Zielerreichung Ihres Vorhabens dienen?

Aktive Suche von Partner vor Ort (siehe Partnersuche – Dia- log und Akquise)

Klassische Kommunikationsformen (PPP-Report, etc.)

Possible measures in order to promote PPPPossible measures in order to promote PPP



Back-up: The Road to PPP – Back-up: The Road to PPP – the partner

How to find a partner? - locally Through contacts and dialogue in the context of the TC programme:

Companies that “come along” Via business platforms that deal with issues

relating to Corporate Social Responsibility (CSR) Ongoing dialogue with bi-national Chambers

of commerce, engagement in national Global Compact Network, business and trade associations



Back-up: The Road to PPP – Back-up: The Road to PPP – the partner

How to find a partner? - locally Through special acquisition efforts

Local Workshops with sector companies to pro-mote possibility to work with GTZ in PPP (Fachgespraech)

Tendering for proposals example to be developed



The Road to PPP – The Road to PPP – the contract and implementation designes

Consulting As more favourable

consulting service Implementation by

company Local company as

3rd party Administration and

monitorring by GTZ PPP Consulting

Contract Example: GEWC

Cooperation

Joint responsibility for implementation

All partners contribute know-how / resources

No transfer of funds between partners

GTZ contribution is Facility financed

PPP Cooperation Contract

Contracting GTZ

As implementing service provider

Implementation by GTZ Financed by GTZ funds

and by company or other donors (DIFID, SECO, multilaterals …)

PPP combined financing contract

Form of contract has effects on the implementation!



Benefits for GTZBenefits for GTZ

Access to other wise inaccessible know how

Additional financial ressources

Sustainability on the basis of a long term economically driven engagement

Private companies are THE modernization force within the economy



Benefits for the private sector/companiesBenefits for the private sector/companies

Reputation: BMZ/GTZ als neutraler Partner

Regionalspezifisches und interkulturelles Know-How der GTZ

Kontakte zu öffentlichen Stellen der Partnerländer

Risikomanagement: vorbeugende Maßnahmen (Standards), um z.B. imageschädigende Kampagnen zu vermeiden

Philantropie versus PPP



InterventionsebenenInterventionsebenen

Erarbeitung von Richtlinien, Standards

Entwicklung von Aus- und Fortbildungsgängen

Technologietransfer

Einführung innerbetrieblicher Verbesserungen als Pilotmaßnahmen (HIV/Aids-Arbeitsplatzpolitik)

An International Cooperation Enterprise for Sustainable Development Public-Private Partnership in GTZ – Slide 1 Public-Private Partnerships The PPP-Concept.

Documents

gtz slide

private companies

publicprivate partnerships

state slide

private sector partners

privatesector engagement

development countries

mio private share