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72 were delivered late. In the same study, 73 percent of non-PPP projects were delivered over budget, whereas only 20 percent of PPP projects were delivered over-budget (UK Treasury 2006). In a 2005 evaluation, the European Investment Bank reported similar findings. However, a 2014 evaluation of World Bank Group support to PPPs indicated that PPP efficiency was similar to that of public infrastructure projects - some performed well, but others demonstrated high costs and construction delays (EIB 2005). Improved Access, Quality, and Maintenance of Public Services Budget deficits and competing policy priorities create a political disincentive to devote funds to the maintenance of existing infrastructure. The effects of neglecting maintenance are often only recognized in the long-term, long after specific political actors have left office. Ongoing neglect creates a situation where developing countries not only face challenges developing much-needed new infrastructure but they are also increasingly unable to maintain current levels of service delivery as existing assets deteriorate (Deloitte 2008; Farlam 2005). In such a situation, the general public has little recourse for insufficient service delivery. Moreover, the scarcity of available public goods may encourage some officials and public servants to accept bribes in exchange for access to services (Farlam 2005). Where a private sector actor is made responsible for running and maintaining public infrastructure under a PPP arrangement, maintenance and service delivery standards may be enforced through contractual performance standards (Deloitte 2008). Furthermore, because private sector operators often depend on the payment of tariffs and fees to ensure the profitability of the investment, there is a natural incentive to deliver services that meet consumers’ needs and expectations. Virtually all of the projects that were examined in an evaluation of World Bank Group support for PPPs were successful in increasing access to basic public services (IEG 2014). Moreover, it is possible to introduce contractual provisions that can further ensure that subsequent public service delivery is pro-poor by requiring partners to service poor areas in exchange for the right to service wealthier areas. Subsidies provide another means of mitigating the need for tariff increases in contexts where it is unfeasible to operate on a cost-recovery basis (Farlam 2005). Why have PPPs Failed to Address the Infrastructure gap? Despite the initial enthusiasm for PPPs, private sector participation in infrastructure investment remains below the level required to address Africa's infrastructure gap. The past decade has further demonstrated that PPPs are not a panacea for infrastructure challenges across the developing world where many projects either fail or result in unanticipated development impacts. PPP projects are complicated to establish and implement even under optimal conditions (McKinsey 2009); Deloitte 2008). Their success generally requires long-term political commitment, agreement among several groups of stakeholders, public and political support, and a favorable market environment (IEG 2014; Araujo and Sutherland 2010; Farlam 2005). Need for a PPP-enabling Environment Successful PPP arrangements tend to be found in more mature economies with stable governance, supportive legal and regulatory frameworks, sufficient institutional capacity, and predictable administration of justice (IEG 2014; ADB 2009; Araujo and Sutherland 2010; Hammami et al. (1999). Unclear or unsuitable rules, weak governance and similar challenges tend to increase costs and risk and make PPP arrangements commercially unviable. eVALUatiOn Matters
Even when private sector actors are willing to participate in PPPs, inadequate legal and regulatory infrastructure can make it difficult or impossible to conclude an appropriate agreement for construction, operation, and service delivery (Deloitte 2008; Araujo and Sutherland 2010; Farlam 2005). Beyond requiring a supportive institutional and regulatory environment, PPPs need a supportive market environment and sufficient public procurement capacity to ensure that they provide value for money (Samir, 2008). First, there must be a sufficient number of private sector actors capable of managing and implementing the design, construction, and service delivery aspects of each project in order to ensure sufficient competition. These actors must then be able to access private financing sources at a cost that does not outweigh the potential efficiencies realized thanks to private sector participation. Finally, public sector actors must possess sufficient procurement capacity to ensure fair and transparent competition among the potential service providers. Absent these qualities, it will be challenge to ensure appropriate value for money. Challenges in Ensuring Pro-Poor Service Delivery Although PPPs may lead to more efficiently delivered public services of higher quality, they do not necessarily result in greater access to services, particularly for the poorest segments of the population. The proposition that PPPs lead to greater access to services is partly premised on the assumption that increased efficiency in service delivery results in lower service tariffs that make basic services more affordable (IEG 2014; Farlam 2005). However, some governments fail to maintain and expand the provision of basic services in part because they are under political pressure to preserve long-standing below-recovery rate tariffs and also lack accurate information about service delivery costs (Farlam 2005). Efficiency gains realized through PPP arrangements may not suffice to offset the difference between existing tariffs and actual service delivery costs. PPPs could in fact raise costs as private operators attempt to ensure that they recover their operating expenses. Moreover, private sector operators may be hesitant to provide services to poor, remote areas where the activities are unlikely to be commercially viable (Farlam 2005; Hammami et al. 1999). While they can contribute to improved infrastructure and service delivery, PPPs may work against inclusive growth if the poorest segments of the population cannot afford to access basic services. Need for Long-term Political and Public Support Long-term political and public support is essential if PPP arrangements are to succeed. However, many developing countries, and especially conflict-affected states or states in transition, lack the necessary political stability to successfully implement PPPs. Absent an agreement among various stakeholders and a clear political champion, PPPs succumb to political conflict rooted in a fear of change, restructuring, and possible public sector job losses Political championship is also tied to levels of public support -- another requirement for a successful PPP -- particularly when projects involve services such as water supply and sanitation services that are typically thought to be a public responsibility (Farlam 2005; ADB 2009; Hammami et al. 1999). A study of the Inter-American Development Bank's support to PPPs in Brazil demonstrates the necessity for parties to a PPP arrangement to develop a clear communications strategy that explains the needs and benefits of the PPP and the need for potential tariff increases. Furthermore, all aspects of project design and delivery, including the procurement and contracting processes, must be transparent (Queiroz et al. 2014). 73 A quarterly knowledge publication from Independent Development Evaluation, African Development Bank Group
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eVALUatiOn Matters A Quarterly Know
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Contents 4 11 35 62 69 80 89 Emergi
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Goals (SDGs), I believe the issue o
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7 Recently Completed IDEV Evaluatio
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Assessment of Inclusive Growth and
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11 Looking ahead - Inclusive Growth
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esilience, but not the AfDB to date
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The presentation states that the Ba
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improved development planning, and
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protection, and, unlike ADB’s (se
Page 21 and 22: electricity, clean water or to mobi
Page 23 and 24: its impact on health 27 . Most CSPs
Page 25 and 26: include rural roads and address ped
Page 27 and 28: The link between rural road improve
Page 29 and 30: for example). Some CSPs do, however
Page 31 and 32: planning, improved public transport
Page 33 and 34: strategy was articulated in 2008 an
Page 35 and 36: 35 Scaling up AfDB Country Strategy
Page 37 and 38: Introduction In this report we revi
Page 39 and 40: • External catalysts: Political a
Page 41 and 42: CSPs, usually “support for infras
Page 43 and 44: • The need to substantially raise
Page 45 and 46: an existing gap of a part of latter
Page 47 and 48: (lending and non-lending) achieve t
Page 49 and 50: • While broadly concerned with ac
Page 51 and 52: This question (and its sub-question
Page 53 and 54: egional environmental assets and da
Page 55 and 56: that broader scale goals need to be
Page 57 and 58: various potential constraints in th
Page 59 and 60: outcome measures, and lacking base
Page 61 and 62: In conclusion, including scaling up
Page 63 and 64: Evolution of Country Strategies and
Page 65 and 66: esults log-framework does not allow
Page 67 and 68: References African Development Bank
Page 69 and 70: 69 Erika Ismay MacLaughlin and Khal
Page 71: There are opportunities for the AfD
Page 75 and 76: support was similarly unsuccessful
Page 77 and 78: have market and governance conditio
Page 79 and 80: ABOUT THE AUTHOR 79 Erika MacLaughl
Page 81 and 82: Côte d’Ivoire’s agriculture is
Page 83 and 84: PLENARY ASSEMBLY (all members) 83 M
Page 85 and 86: In agriculture, many results have b
Page 87 and 88: http://wbi.worldbank.org/wbi/ news/
Page 89 and 90: 89 Chi Bemieh Fule Rigorous Impact
Page 91 and 92: support from AFOP. Since 2008, the
Page 93 and 94: Impact Evaluation as a Monitoring T
Page 95 and 96: ents? n article? to us ters@afdb.or
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