Sep 2006 Financial News

First Caribbean looking into PPP

Sep 21, 2006

FIRST CARIBBEAN International Bank is embarking on initiatives to have projects delivered using the Public Private Sector Partnerships (PPP).

News of this has come from Horace Cobham, Executive Director, Corporate Banking, First Caribbean International Bank. Cobham spoke at a recent construction seminar where PPP was among the topics discussed.

This year, First Caribbean in partnership with the regional private sector has entered into negotiations with two regional governments on projects to be delivered on a PPP basis, including the first PFI project of its type in the region, Cobham said. PFI Public Financial Initiative is another form of PPP.

Cobham explained that the private sector will design, build, own and operate the project which will deliver public services to certain agreed performance criteria on an agreed price structure to government.

This project delivered on a PFI basis can become the catalyst for delivery of this particular public service across the region, according to him. Regrettably however, both of these partnerships are still in the indicative stages, with the binding agreements now to be finalised, therefore it would be inappropriate for me to say more at this juncture, Cobham told participants at the seminar held at the Hilton.

Cobham said he had mentioned the projects to underline that with its footprint in 17 countries, and with its international resources such as with Barclays Bank PLC, FirstCaribbean stands ready to assist regional government in unlocking the potential and benefits of PPPs.

He remarked that the conference was therefore timely, since it not only provided the educational grounding in PPPs, but also presented the framework for successful PPPs.

The official said that the move towards public/private partnerships is not only supported by a number of governments in the Caribbean, but it is becoming the preferred way forward. Indeed, the Prime Minister of Barbados has recently expressed his support for this procurement and financing approach, he stated.

Cobham said that regional governments are being obligated to build needed infrastructure, maintain existing assets and replace worn-out assets on a timely basis. They are expected to provide public services in a timely and efficient manner. All these must be done on limited financial resources, according to the FCIB official. One form of PPP, the Private Finance Initiative (PFI) is well established in the UK and reportedly performing quite well, allowing government to deliver new roads, prisons, schools and hospitals without raising taxes, he noted.

This is one PPP methodology that holds some of the greatest interest and possibly promise, as it speaks not only to the issue of delivery of infrastructure development, but also the operating and managing of services that have traditionally been delivered by the public sector, explained Cobham.
The two-day seminar was sponsored by Caribbean Construction Advisory Services and Tower Bucknall Austin.

Source:
The Barbados Advocate
Thursday 21st September, 2006

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