Treasury picks team to advise on mega public-private deals
From left: World Bank senior adviser public-private partnerships (PPPs) Stefan Kauder, the Treasury’s PPP unit director Stanley Kamau and Ministry of Education chief economist Isaac Kamande during a workshop on PPPs at the Hilton Hotel in Nairobi on December 15, 2014. PHOTO | SALATON NJAU
What you need to know:
The PPP Unit formed as a division of the Treasury to oversee private investment in public infrastructure ventures has appointed nine advisers to help State agencies seeking investors to undertake public projects jointly.
Roads, rail, ports, airports, health, water, education, counties and energy are the nine key areas of focus for the advisory team.
The Treasury has set up a team to advise on multi-billion shilling projects undertaken through public-private partnerships (PPPs) in nine different sectors of the economy, hoping to fast-track State projects by tapping investor funding.
The PPP Unit formed as a division of the Treasury to oversee private investment in public infrastructure ventures has appointed nine advisers to help State agencies seeking investors to undertake public projects jointly.
The team is set to begin work in January.
“There are many institutions that do not understand the PPP concept simply because they have never done it before and, therefore, need somebody to hold their hand and show them the way,” said PPP unit director Stanley Kamau on Monday.
The Cabinet has cleared a list of 47 projects worth Sh1.7 trillion to be financed through PPPs. They range from hospital equipment and student hostels to major highways, airports, seaports as well as energy-related.
The consultants are expected to assist in preparing draft terms of reference and procurement documents for the selection of transaction advisers, PPP experts, sector consultants and staff.
Roads, rail, ports, airports, health, water, education, counties and energy are the nine key areas of focus for the advisory team.
Mr Kamau said some of the advisers are expatriates, but did not disclose their nationalities.
“We’re in the final stages of contractual negotiations and they are expected to be on board in January. The consultant in charge of counties has actually been in office since the beginning of December,” said the director.
The PPP consultant on education would be based at Jogoo House, while the rest would sit at the Treasury Building.
Mr Kamau was speaking at a workshop convened to sensitise public universities and colleges on the PPP model, noting that a lack of technical expertise was one of the reasons some projects stall or fail to take off.
The government is banking on private capital to plug a huge financing gap for infrastructure projects as social programmes and constitutional implementation take up the bulk of its revenue.
The use of private money is expected to help in faster completion of projects and reduce the need for the government to borrow directly.
Treasury PS Kamau Thugge said Kenya has an annual infrastructure financing deficit of about $2.1 billion (Sh190bn) – money he said could be sourced privately.
“We continue to face this shortfall despite increased budgetary allocations and partnerships with private investors is one way of tackling this problem,” said the PS.
Among the projects, Sh850 billion would be used to generate 5,000 megawatts of electricity in the next four years.
A further Sh153 billion would be spent on construction of the Nairobi-Mombasa road, Sh34 billion for the upgrade of Nairobi-Nakuru road and Sh17 billion to build the Nyali Bridge in Mombasa.
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