The Sunday News
Roberta Katunga in Victoria Falls
THERE is a need to establish institutional and legal framework that promotes Public Private Partnerships (PPPs) so as to bridge the infrastructural gaps existing in the region, an official said.
Addressing delegates at the Southern Africa Development Community (Sadc)-Development Finance Institutions regional conference, Reserve Bank of Zimbabwe (RBZ) Deputy Governor Dr Khuphukile Mlambo said it was imperative for governments to put in place the right policies and engage the private sector to push for the adoption of PPPs.
Dr Mlambo said PPPs are critical in the implementation of infrastructural developmental projects as they incorporate innovation and skills development.
“It is important to create an enabling environment to promote PPPs, on the policy side we are ready to work with Development Finance Institutions (IDFs) for the PPPs frameworks to function. We are aware that infrastructure has suffered a lot although in Zimbabwe good progress has been made especially on the road network but the Government on its own cannot afford to finance these projects as 90 percent of the budget goes towards employment with the capex budget shrinking,” he said.
Dr Mlambo said most infrastructural development in a number of countries was being carried out by the private sector due to lack of capacity by the public sector.
According to Dr Mlambo, the Sadc Regional Infrastructure Development Master Plan has identified $500 billion worth of projects to be implemented over the next 10 years with at least $100 billion of the required amount expected to come from the private sector financing sources.
The infrastructure that has been identified for development include the road and rail in the transport sector, energy as well as countries’ ports of entry and exit, with the projects expected to enhance regional integration.
“DFIs are expected to play a leading role in working with governments to prepare national and cross border projects at an early stage and generally to act in an advisory capacity on matters of investment, including PPPs,” said Dr Mlambo.
Adding that this was urgent as only two countries in the region, South Africa and Mauritius, boast active markets.
Sadc Development Finance Resource Centre chief executive officer Mr Stuart Kufeni said the growing popularity of PPPs was an indication by governments that their developmental needs to achieve sustainable and inclusive economic growth are huge and required more funding than their fiscuses can afford.
He said Zimbabwe lacks a conducive environment for PPPs to thrive, although it was important to ensure that the legal framework was in place.
“We already have four DFIs in Zimbabwe but there is a need to establish the institutional and legal frameworks as has been alluded to,” said Mr Kufeni.
Development Bank of Southern Africa chief executive officer Mr Patrick Dlamini said there is also a need for DFIs and governments to raise project capital to develop feasibility studies and structure projects in a sustainable manner.
“The intra-regional trade is extremely important and the job creation within Sadc countries and the partnership between companies within Sadc and the promotion of regional Small and Medium Enterprises and the promotion of women in business within Sadc and the sourcing of products between ourselves and the region is extremely important,” he said.
The two-day conference which ran under the theme: “Building partnerships for Economic growth and development” was hosted by the Industrial Development Corporation, Agri-Bank, Small and Medium Enterprises Development Corporation and the Infrastructure Development Bank of Zimbabwe.
A total of 37 DFIs from the region attended the event.
