By David Baxter
How can sustainable PPPs and resilient infrastructure help accelerate progress toward the Sustainable Development Goals (SDGs)? Just days after the UN Climate Change Conference (COP29) in Baku, the United Nations Economic Commission for Europe (UNECE) hosted a gathering of public and private sector public-private partnership (PPP) practitioners in Geneva to discuss exactly this.
The gathering raised and addressed some important questions relevant to emerging economies: how do resilient PPPs and infrastructure contribute to a sustainable future? What are ways to ensure the financial stability of PPPs? And how can new technologies be leveraged in resilient infrastructure PPPs?
Although delegates expressed concern about SDG goals not yet being achieved, there was renewed enthusiasm among practitioners to explore innovative sustainability and resilience best practices—even in a world that questions what PPPs should look like and who should implement them.
Generally, there was agreement that the debate about sustainable PPPs should focus on common sense best practices and consensus that address the contextual needs of PPPs.
Here are my takeaways:
- Recalibrating PPPs: Globally, the concept of sustainability and resilience is under the spotlight, especially when it comes to stakeholder buy-in and perceptions about the associated cost of implementing international sustainability standards. “Imposed standards” are globally becoming unpopular at the government level. However, in a purely practical perspective, it makes sense to point out best practices that offer common sense long-term solutions. A recalibrated approach that is sensitive to changing global perceptions is essential if progress is going to be made in this area.
- Setting practical SDG goals: It is important that recommended standards and promised outcomes are palatable, practical, implementable, and tailored to the specific priorities, needs, goals, and objectives of the government agency initiating the PPP and the users and stakeholders benefitting from it. The setting of practical goals should not take place in a vacuum, but involve considerable stakeholder consultation so that implementable goals are included in project outcomes. Again, it must be pointed out that SDG practical standards “could” be considered instead of “should” be considered. Moreover, institutions could be encouraged to select SDG project goals that are specific to the contracting authority’s mandates, thereby mitigating institutional angst about feasibility.
- Clearing the fog of confusion around sustainability and its importance to PPPs: Most of the PPP debate in recent years has focused on defining PPPs. But what exactly does it mean for PPP projects to be “sustainable”? The interface between SDG goals and PPP project goals should be expanded to include a more succinct and contextually sensitive definition of sustainability that addresses divergent and different cultural perceptions and norms and mitigates the surrounding fog of confusion. This means recognizing that one size doesn’t fit all and that harmonizing project goals should take place when designing PPPs. These would provide a clear project definition and goals that could be shared with project stakeholders and defended when sustainable PPP projects are planned.
- Implementing SDG-driven PPP projects through mobilizing additional resources: Implementing SDG-focused PPP project goals requires additional institutional and financial resources. Every public sector institution that considers SDG-driven PPP projects needs to collaboratively mobilize the necessary additional resources and explore innovative alternative financing mechanisms with the private sector. When it comes to innovative alternative financing it’s increasingly important that the traditional PPP Value for Money (VfM) assessment approach needs to also consider Value for People (VfP) and Value for the Planet (VfPL) so that SDG outcome-driven PPP projects also address the additional resource cost of future-proofing. If not addressed in the expanded assessment, many stakeholders will balk at perceived additional sustainability resource costs that could impact the short-term commercial and economic viability of projects, instead of focusing on the long-term project benefits.
- Improving PPP policy and practice: During the gathering on the heels of COP29, a voluntary standard was discussed that provides a legal framework that could be adopted by countries seeking to implement PPP projects that deliver on achieving the SDGs. These guidelines should be considered by sustainable PPP project champions as it proposes “rules and procedures related to the selection, preparation, appraisal, procurement, and implementation of projects in accordance with the principles of transparency, fairness, stability, proper management, integrity, completion, economy, and long terms sustainability.” This document addresses the need for coherent policy and practices that would make sustainable PPP projects more palatable and practical.
An honest and practical approach to implementing PPPs based on objective assumptions that address the pros and cons of what sustainability means can only bode well. Participatory stakeholder consultation—that works to avoid negative rhetoric and mitigate unconstructive perceptions—will only enhance the opportunity to deliver future-proofed sound investments.
– The content of this blog does not necessarily reflect the views of the World Bank Group, its Board of Executive Directors, staff, or the governments it represents. The World Bank Group does not guarantee the accuracy of the data, findings, or analysis in this post.
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