daniel chigunwe
Lovemore Chikova
Development Dialogue
The Zimbabwe Investment and Development Agency (ZIDA)’s moves to push forward public private partnerships (PPPs) is a welcome move in light of the developmental trajectory the country has taken.
The advantages of PPPs, especially to an emerging economy like Zimbabwe, are profound.
PPPs are mainly carried out in the development of infrastructure, and in most cases, the cost of infrastructure in developing countries surpasses the available public funds over the short and medium term.
This means that developing countries like Zimbabwe have limited funding for infrastructure development, yet infrastructure is key to economic development.
PPPs are a business venture between the public sector and the private sector, with the aim of ultimately benefiting the public when the project is completed.
In fact, investors can take advantage of the availability of PPPs to invest their funds, as these would be secured through the explicit agreements that form such joint ventures.
Previously handled under the Joint Venture Unit in the Ministry of Finance and Economic Development, PPPs now fall under ZIDA following the repealing of the Joint Venture Unit Act by the ZIDA Act.
Now that ZIDA is a one-stop investment centre, it can easily handle such types of joint ventures, with specific outlines and agreements on how to implement them.
This gives confidence to investors, and also benefits the general population, knowing that whatever type of infrastructure being constructed under PPPs will eventually be used by the people.
Another advantage of PPPs is that projects undertaken under such an arrangement usually meet the timelines because of the availability of resources from the private sector.
Take the US$300 million Beitbridge Border Post modernisation joint venture, for example.
Work being carried out on the port of entry through the joint venture between the Government and the Zimborders Consortium has changed the border post.
The busy port of entry is expected to have upgraded to international standards by the time the project is completed.
The project is being implemented in three phases, with the freight, roads and information communication technology being in phase one, and having been completed on time.
The other phases are the bus terminal in phase 2 and the light vehicles and out-of-port works in Phase 3.
This modernisation of the Beitbridge Border Post gives Zimbabweans a glimpse into what PPPs can achieve when done according to the agreed frames.
It is a good example of how PPPs, when given priority, can have a huge impact in enhancing economic development through infrastructure development.
In line with the accelerated promotion of PPPs, ZIDA this week signed a memorandum of understanding with the Procurement Regulatory Authority of Zimbabwe (PRAZ) to collaborate on technical support and strategies that enhance transparency and ease of doing business in PPPs.
The MoU will enhance PPPs in that the two important developmental organisations will share information in strengthening systems on procurement practices.
The ultimate purpose being to boost the ease of doing business and transparency in accordance with the law relating to public procurement.
The MoU will involve exchange of technical expertise between the two entities when it comes to procurement relating to PPPs.
Speaking at the signing ceremony on Monday, ZIDA acting chief executive officer Mrs Duduzile Shinya said the collaboration would help move forward the implementation PPPs, while enhancing the ease of doing business.
“Following this signing ceremony, we are excited that this will drive the national development agenda as public procurement can be leveraged,” she said.
“This resonates with ZIDA’s strategic objectives of accelerating Zimbabwe’s economic growth through investment promotion and national development.
“We want to work together with PPPs processes and contracting authorities, making it easier to do business within the public sector. We pledge that we will be a good partner with continuous and constant communication, collaboration on projects with contracting authorities.”
PRAZ chief executive officer Mr Clever Ruswa said his organisation and ZIDA were key in driving the national development agenda, hence their commitment to ease of doing business in relation to PPPs.
“Public procurement can be leveraged as a strategic socio-economic policy lever,” he said. “This resonates with ZIDA’s strategic objective of accelerating Zimbabwe’s economic growth and improving the ease and cost of doing business in Zimbabwe.
“Training will be conducted with the main target being jointly identified interest group programmes with special emphasis on (but not limited to) procurement entities entering PPPs.
“The signing ceremony fulfils the power of the authority that is outlined in the Public Procurement and Disposal of Public Assets (PPDPA) Act Chapter 22.23 Section 7 subsection B which stipulate that PRAZ should cooperate with other organizations whether inside and outside Zimbabwe in the exercise of its functions.”
PPPs are on the government’s developmental agenda as confirmed by the Zimbabwe Infrastructure Investment Programme that was launched recently by the Ministry of Finance and Economic Development which recognises them in the development of infrastructure.
These PPPs can be implemented in any sector like the establishment of infrastructure such as airports, ports, power, roads, dams, water treatment plants and solid waste management plants. They are necessary even for construction of other infrastructure like schools, housing, clinics and hospitals.
The committee that works on the implementation of PPPs consists of secretaries for the ministries of finance; industry and commerce; transport and infrastructural development; energy and power development and local government and justice.
A representative of the Attorney General and the ZIDA chief executive also sit in that committee.
In light of these developments, ZIDA has already identified several investment opportunities that can be exploited for PPPs in various sectors.
In the energy sector, PPPs can be formulated in independent power production, hydro power, thermal power and coal methane gas, while under transports there are roads and bridges, rail, air, marine and pipelines.
Opportunities for PPPs in water and agriculture exist under dams construction and conveyance systems, water and sewer treatment plants, irrigation and creation of economic hubs.
In health, PPPs can come in under the rehabilitation and expansion of health facilities and the construction of new ones, while in education there can be collaboration in improvement and construction of learning facilities and construction of student facilities.
In housing, there is the opportunities for PPPs abound in the establishment of bulk infrastructure and in the construction of apartments and flats for rentals and rent to buy.
The PPPs can be implemented in either new or existing projects, with their sources of origin being either the public sector where they come from line ministries, parastatals and other government departments or from the private sector made up of private investors.
What is important to note is that the contracting authority and ZIDA are the two key institutions involved in the implementation of PPPs investments.
To facilitate PPPs and the ease of doing business, ZIDA has established a PPPs unit which performs the following functions:
a) to consider project proposals submitted to it and assess whether or not they are (i) affordable to the contracting authority; and (ii) provide value for money; and (iii) provide for the optimum transfer of technical, operational and financial risks to the counterpart; and (iv) are competitive
b) through the Chief Executive Officer, to make recommendations on such proposals to the Cabinet; and
c) to examine requests for project proposals to ensure they conform with the approved feasibility studies; and
d) to advise Government on PPPs generally; and
e) to develop best practice guidelines in relation to all aspects of PPPs; and formulate suggested policy in relation to PPPs for adoption by the Government; and
g) to develop awareness of PPPs in Zimbabwe as a vehicle for economic development and delivery of public services; and
h) through the Chief Executive Officer, to make recommendations on project proposals submitted by contracting authorities to the Cabinet as to whether to approve or reject project proposals; and
i) to undertake monitoring and evaluation of PPPs and, where necessary, through the Chief Executive Officer, to make appropriate recommendations concerning such projects to the Cabinet and contracting authority.
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Peter Tanyanyiwa
Online Reporter