Public Private Partnership (PPP) in the Middle East and North Africa 2021 and beyond – MEED Insights

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Modern infrastructure and world-class public services are central to the national visions being pursued across the Middle East and North Africa (Mena), as governments try to meet the needs of growing populations. Equally important, is the goal to grow private sector participation in driving growth and creating jobs.

Executed properly, public private partnerships (PPP) will deliver these goals. PPPs provide a model that allows governments to continue developing strategic projects and services without the need to increase direct state capital spending.

At the same time, a reliable flow of well structured, commercially attractive PPP projects will stimulate private investment and ensure that strategic performance targets to improve services and reduce waste are achieved.

But despite these compelling selling points, PPPs largely have failed to gain traction in the region outside the electricity sector, where modular construction, sovereign offtake guarantees, and long-term feedstock supply agreements reduce complexity and risk.

The New Normal

There are many reasons for the slow adoption of PPPs in the Mena region. Lack of supportive legal and institutional frameworks. Lack of capacity. Lack of track record. Failure to provide bankable projects that are attractive to investors. And so on. But the biggest factor has been a lack of political will to move to PPP. There has been no urgent need to hand over state assets to private developers.

This picture has changed. Since 2015, weak oil prices have hit the revenues of oil producing countries, particularly those in the GCC.

In 2020, Covid-19 applied breaking strain to the regional economies, and traditional public spending trends is being reviewed and cut back. Historically governments have invested heavily into infrastructure projects and public assets such as hospitals, schools, transport and more. Post-Covid-19 world, new forms of project finance are required.

Governments across the region are turning their focus to alternative project finance solutions, and PPP contracts are taking shape.

The report identifies a pipeline 242 PPP projects worth an estimated $223bn being developed.

These include schools projects in Saudi Arabia, healthcare in Kuwait and water and power projects in Qatar. In early 2020, Abu Dhabi announced its intention to tender US$2.7 billion in PPP projects to finance and operate new social, municipal and transportation assets.

For contractors, consultants and anyone else involved in the region’s construction and infrastructure industry, PPP is arguably the most exciting and lucrative source of new business opportunities around.

Countries that do not already have PPP legislation in place are moving hastily to establish new legal and institutional frameworks to support PPPs, while those that do are drawing up significant pipelines of projects to take to the market. Some schemes are being tendered even before legislation is put in place.

Bankable projects

It will not be easy, and the latest push towards PPP must avoid the pitfalls of the past to succeed. Selecting appropriate and bankable projects will be key, as will building up institutional capacity and developing a body of skilled civil servants.

This report is the latest premium market intelligence report from MEED Insight. It provides a comprehensive review of the region’s growing PPP market and assesses the outlook, opportunities and challenges for PPP in the region.

Covering 14 markets in the Mena region, PPP in the Middle East and North Africa 2021 assesses the legal and institutional frameworks that are being set up to support PPPs.

It examines the PPP project pipeline in each country and considers the political, economic and commercial challenges involved in contracting successful PPP projects.

Published in October 2020, the report looks at how Covid-19 has both disrupted and accelerated PPP in the region.

Written by MEED, the Middle East market experts within the GlobalData Group, providing a comprehensive market review with forward-looking analysis, this report is a valuable resource for anyone interested in PPP in the Mena region, including government central units, policy makers and advisers, regulators, developers, lawyers, investors, contractors, manufacturers and consultants.

Scope

  • Identifies and details a pipeline of 242 current and planned PPP projects worth an estimated $223bn being developed.
  • Covers 14 country markets, including: Algeria, Bahrain, Egypt, Iran, Iraq, Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Saudi Arabia, Tunisia and UAE.
  • Examines the plans for PPP in all sectors including education, healthcare, housing power, transport, wastewater and water.
  • Examines the history of PPP projects and assesses investment and contracting opportunities in the region.
  • Offers an assessment of the impact of COVID-19 on PPP plans.
  • Examines PPP legal and institutional frameworks in the region and details of PPP central units and PPP legislation.
  • Details key clients and PPP sponsors.

Reasons to Buy

  • Understand the PPP market in the region, inform strategy and identify new opportunities.
  • Gain insight into PPP policy and legal frameworks.
  • Highlight any challenges you may face in the market.
  • Understand the impact of COVID-19 on PPPs in the region.

Table of Contents

Table of Contents

1. PPP moves forward amid Covid crisis

1.1 What is public-private partnership?

1.2 Advantages and disadvantages of PPP

1.3 Past experience

2. Gulf – GCC regional summary

3. PPP in Bahrain

3.1 Commentary

3.2 Policy & Regulations

3.3 History

3.4 Projects

4. PPP in Iran

4.1 Commentary

4.2 Policy & regulations

4.3 History

4.4 PPP programme and projects

5. PPP in Iraq

5.1 Commentary

5.2 Policy & regulations

5.3 History

5.4 Projects

6. PPP in Kuwait

6.1 Commentary

6.2 Policy & regulations

6.3 History

6.4 Projects

7. PPP in Oman

7.1 Commentary

7.2 Policy & regulations

7.3 History

7.4 Projects

8. PPP in Qatar

8.1 Commentary

8.2 Policy & regulations

8.3 History

8.4 PPP Programme

9. PPP in Saudi Arabia

9.1 Commentary

9.2 Policy & regulations

9.3 History

9.4 PPP Programme and projects

10. PPP in the UAE

10.1 Commentary

10.2 Dubai

10.3 Abu Dhabi

10.4 Northern Emirates

11. Levant

Regional summary

12. PPP in Jordan

12.1 Commentary

12.2 Policy & regulations

12.3 History

12.4 Programme & projects

13. PPP in Lebanon

13.1 Commentary

13.2 Policy & regulations

13.3 History

13.4 Programme & projects

14. North Africa

15. PPP in Algeria

15.1 Commentary

15.2 Policy & regulations

15.3 History

15.4 PPP Programme & projects

16. PPP in Egypt

16.1 Commentary

16.2 Policy & regulations

16.3 History

16.4 Programme & projects

17. PPP in Morocco

17.1 Commentary

17.2 Policy & regulations

17.3 History

17.4 Projects

18. PPP in Tunisia

18.1 Commentary

18.2 Policy & regulations

18.3 History

18.4 PPP Programme & projects

19. Appendix

Table

List of Tables

Table 1: PPP framework and projects pipeline summary

Table 2: Prince Mohammed bin Abdulaziz International Airport

Table 3: Risk allocation for New Cairo Wastewater Treatment Plant Project

Table 4: Mafraq-Ghuweifat Highway

Table 5: Top 15 active PPP projects, GCC

Table 6: North Bahrain New Town and Al-Lawzi housing project

Table 7: Ongoing/upcoming projects in the housing sector

Table 8: LNG Import Terminal

Table 9: Upcoming projects in the transportation sector

Table 10: MEW Al-Dur 2 IWPP

Table 11: Askar waste-to-energy plant

Table 12: Ongoing power projects

Table 13: Ongoing water projects

Table 14: Planned airport BOT schemes

Table 15: Selected power and water projects

Table 16: Iraq transport projects

Table 17: Selected oil projects

Table 18: Status of KAPP projects

Table 19: Al-Zour North IWPP phase 1

Table 20: Al-Zour North IWPP phase 2 & 3

Table 21: Al-Khiran IWPP phase 1

Table 22: Al-Kabd municipal solid waste facility

Table 23: Al-Abdaliyah integrated solar combined-cycle IPP

Table 24: Al-Dibdibah Solar project

Table 25: Kuwait National Rail Road

Table 26: Kuwait Metropolitan Rapid Transit System

Table 27: Kuwait Metro phases

Table 28: Schools development programme

Table 29: Ongoing/upcoming projects in the housing sector

Table 30: PPP projects originally planned under PTB

Table 31: Sultan Qaboos Medical City PPP

Table 32: Ongoing PPP projects in the power & water sector

Table 33: Planned renewable energy IPPs

Table 34: List of Qatar schoools PPP packages

Table 35: Planned PPP projects

Table 36: Pipeline of PPP projects in Saudi Arabia

Table 37: NCP Mandate for PPP Projects

Table 38: Major active power PPP projects in Saudi Arabia*

Table 39: List of bidders with prices for the 300MW PV solar project at Sakaka

Table 40: List of bidders with prices for category A and B Projects

Table 41: Projects under Round 3 of NREP

Table 42: SWCC Contracts between 2019 and 2020

Table 43: Planned IWPs

Table 44: Planned ISTPs

Table 45: Planned IWTPs

Table 46: Planned Railway PPP Projects

Table 47: PPP Projects under execution

Table 48: Upcoming projects in Dubai

Table 49: Major ongoing PPP projects

Table 50: Upcoming projects in Abu Dhabi

Table 51: Planned projects in the UAE Northern Emirates

Table 52: Selected planned projects

Table 53: Power projects under construction*

Table 54: Planned IPPs

Table 55: Ongoing water projects

Table 56: Transport projects

Table 57: PPP projects pipeline in 2017

Table 58: Selected PPP projects under execution in Egypt

Table 59: West Nile IPPs that have been put on hold

Table 60: Selected planned PPP projects

Table 61: Private municipal utility concessions

Table 62: Power and water projects

Table 63: Tanger-Med Port operators

Table 64: Pipeline of PPP projects

Table 65: Solar power projects

Table 66: Wind power projects

Table 67: Water and wastewater projects

Table 68: Transport projects

Figures

List of Figures

Figure 1: PPP pipeline by country ($m)

Figure 2: PPP pipeline – Volume of planned projects in Mena by sector

Figure 3: PPP pipeline – Estimated budget of planned projects in Mena ($bn)

Figure 4: Motives for abandoning PPP after developer prequalification has begun*

Figure 5: New Cairo Wastewater Treatment Plant STC structure

Figure 6: GCC PPP Framework

Figure 7: PPP projects pipeline by sector, GCC

Figure 8: Legislative framework for the PPP Projects in Iran

Figure 9: Kuwait PPP Timeline

Figure 10: The PPP Framework – proposed contractual structure for Al-Khiran IWPP

Figure 11: KAPP Guidebook for PPP Projects

Figure 12: Kuwait National Rail Road Map

Figure 13: Preferred packaging structure for Kuwait National Rail Road

Figure 14: Kuwait Metro Map

Figure 15: Preferred packaging structure for Kuwait Metro

Figure 16: Key features of Oman’s PPP and Privatisation Laws

Figure 17: Oman PPP Framework Timeline

Figure 18: Locations of primary healthcare centres in Qatar

Figure 19: Saudi Arabia PPP framework timeline

Figure 20: Key Sectors Identified for Private Sector Participation

Figure 21: NTP 2020 Major Objectives

Figure 22: Leading power developers by equity capacity, August 2018 (MW)

Figure 23: SWCC Privatisation Roadmap

Figure 24: UAE planned PPP projects by value and sector

Figure 25: PPP projects by status, as of September 2020

Figure 26: Dubai and Abu Dhabi PPP Policies and Frameworks Timeline

Figure 27: PPP Projects Approval process in Dubai

Figure 28: PPP Project Cycle in Jordan

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