The impact of the TA will be active participation of private investors in PPP project tenders. The outcome will be accelerated reforms to further strengthen the enabling environment for PPP.
The PPP forum will be undertaken over 1.5 days in May 2013. Half a day is scheduled for discussions on the enabling environment and one day for presentations of prospective PPP project opportunities. Representatives of the highest level of government will actively participate in the introductory part of the forum and individual sessions to demonstrate their commitment to PPP. Representatives from foreign private and public sector institutions will participate to provide references for the Kyrgyz PPP framework design and learning experience.
The sessions on enabling environment for PPP will focus on institutional, financial, and legal and regulatory pillars, and the progress made by the Kyrgyz Republic under each pillar. Experiences of other countries at different stages of PPP development and the perspective of the financial sector, represented by local and international banks and international finance institutions, will be presented. The government will also outline the financial support schemes it proposes to establish over the coming months, including a project development facility, long-term debt facility and possibly a viability gap finance facility. These support facilities have proven useful in strengthening the enabling PPP environments of other developing countries. They are particularly critical for the Kyrgyz Republic in light of the current limitations in global project finance, the country's risk profile, and limitations in the domestic project finance market.
The sessions of the forum on PPP project pipelines will introduce short-term opportunities for PPP in urban services, health and transport by presenting a realistic timeframe for further developing (structuring) already-identified projects. The government's commitment to these projects will be demonstrated by aligning them with the overall and sector-specific development strategies and through participation from high ranking officials responsible for the respective sectors. International case studies of comparable PPP projects will provide reference points for further project development. The session on prospective opportunities could include information about PPP initiatives in the energy, tourism and water sectors, subject to further consultation with the relevant ministries in the months leading up to the forum.
Key activities that need to be undertaken under the TA to prepare the forum are: finalizing the list of invitees, developing an event promotion plan, contacting invitees, preparing and distributing promotion material, and preparing presentations by government officials
|Project Rationale and Linkage to Country/Regional Strategy
Economic and social infrastructure is one of the key drivers for economic growth and poverty reduction. Since independence, the Kyrgyz Republic has encountered economic hardships and budgetary deficits constraining the ability of the government to provide adequate financial support for maintaining existing and constructing new infrastructure. In addition, weak capacity across line ministries and other state agencies undermines the efficiency of infrastructure facilities, which are still mainly managed by the government. As a response, the government is undertaking a comprehensive reform initiative to create an enabling policy, legal, regulatory and institutional environment for PPP.
ADB has supported this reform initiative since the Investment Climate Improvement Program (ICIP) Cluster was approved in 2008. PPP reforms reached a new stage in 2012 with the enactment of a PPP law that is in line with international good practices in February 2012, the adoption of a PPP development action plan in April 2012, the adoption of a PPP risk-management policy in October 2012, and the identification of specific PPP project opportunities in the urban, transport and health sectors. These reforms were supported under Subprogram (SP) 2 of ICIP.
Building on these achievements, the government plans to undertake a high level PPP forum in Bishkek in May 2013 to (i) demonstrate the government's commitment to PPP in infrastructure and social services, (ii) demonstrate the quality of the enabling environment for PPP in Kyrgyz Republic and build consensus for further reforms, and (iii) introduce short- and medium-term PPP opportunities for private investors. During his visits in the Kyrgyz Republic in February and October 2012, VPO1 agreed in principle to support such a PPP forum. During his visit to the Kyrgyz Republic in October 2012, DG, CWRD re-confirmed this agreement.
On 23 January 2013 the government established a working group through government resolution No. 12-P to prepare the PPP forum. On 31 January 2013 the working group reached agreement on an agenda and action plan for the preparation of the forum, and a draft lists of invitees from the Kyrgyz Republic and abroad. On this basis, the government requested ADB to provide financial assistance for the forum through a small-scale TA.
The PPP forum will complement and reinforce reforms supported under SP 3 of the ICIP that aim to further strengthen the enabling environment for PPP and facilitate the development of a strong PPP project pipeline. The forum will also help to build consensus for the establishment of PPP project development and financial support facilities that are broadly seen as integral parts of an enabling framework for PPP in line with international good practice.