THE country’s risk profile has contributed to the low uptake of public-private partnerships (PPPs) according to deliberations at an ongoing seminar on infrastructure development in Harare.

Paul Mavima, the principal director in Deputy Prime Minister Arthur Mutambara’s office said Zimbabwe has been facing substantial challenges in accessing funding for its infrastructure development programmes partly because the country does not have resources to take up PPPs, as well as prevailing political risks.
“There has been a low uptake for private-public partnerships largely due to political risk.
“For instance the African Development Bank has billions of dollars in its coffers but due to Zimbabwe’s unique situation, resources have not been forthcoming,” Mavima told a week-long PPPs seminar organised by the Development Bank of South Africa and the Infrastructure Development Bank of Zimbabwe.
Siyanga Malumo, the Africana Finance and Investment director and facilitator at the workshop said it was imperative for African governments to note that due consideration is given by investors to the political situation before they consider funding infrastructure related projects.
“A change in government policy can have a huge bearing on the success or failure of a project, for instance nationalisation is a case in point as a potential risk,” said Malumo referring to Zimbabwe and other African countries with controversial empowerment policies.
Malumo said investors place importance on a country’s degree of political risk before engaging in PPPs.
He said the general consensus was that government does not have sufficient resources to take up PPPs and there is need to engage stakeholders from the private sector.
However, the general agreement among participants was that the government was too bureaucratic in processing PPPs as the whole activity can take up to three years before the project commences.
“Why should the government be so bureaucratic in processing these projects?
“In South Africa, the whole process is transparent and efficient that’s why you find that the country’s infrastructure is so well developed,” said a participant who refused to reveal his name.
The country’s infrastructure needs repair after being neglected for over a decade and funding for such projects is limited by current credit crunch.
The treasury is constrained as revenue generating measures are raking in an average of US$140 million per month.
Mavima said the DPM’s office was exploring new methods aimed at rationalising PPPs in terms of infrastructure development.
The absence of a regulatory and policy framework was cited as a key area that needs critical attention so that the success of PPPs is not hindered by personal interests.
“The major problem surrounding these public-private partnerships are that they do not have an institutional or policy framework therefore you find that in previous agreements made, the engagement was on an individual’s personal interest in the project.
“If the project did not benefit the signatory individual (in government), it would be thrown out of the window so lots of good projects were thrown away,” Mavima said.

BY KUDZAI CHIMHANGWA

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